Seoul, Korea, April 5, 2021 — In a short and sudden press release, LG today announced their intent to close its mobile business unit. Along with it, they confirmed that the decision was approved by the board as well earlier today.
Despite their ability to manufacture innovative smartphones, like the LG Wing, that often broke with the norm, they seek to adjust where their focus lies and boost their other business areas, such as components for electric vehicles (EV) connected devices and smart homes (IoT), Robotics, and AI. The new business model orientation will lean towards B2B solutions, platforms, and services.
LG communicated to buyers of their existing mobile products that they will continue to provide support and software updates. Still, it’s a bitter taste for everyone who trusted them earlier that they simply abandoned the smartphone industry and will not come around the corner with new innovation.
Layoffs at LG are possible
Whether or not they will be reducing staff is not clearly stated. As per their information, they state that “details related to employment will be determined at the local level.” This could mean many different things, but staff who has worked on LG smartphones might not have a safe position as of now.
While the overall smartphone sales took a dive in 2020, the forecast for 2021 looks more optimistic. LG does not state that the mobile business unit’s closure is anyhow related to missed sales goals. Still, it’s also a given that nobody would close a successfully running division only to process a strategic transformation.
It’s not disappointing that they undertook this change because they saw the need for it. It’s disappointing that a large player in the market who continued to deliver good quality and innovative products was not given the welcome they may deserve and that they were ultimately not able to prove themselves in a highly competitive market.
Goodbye, LG phones, maybe we’ll meet again in the future.
YouTube: Why does nobody buy LG Smartphones? (Arun Maini)
Photo credit: The feature image is a photograph from the CES 2020 and is owned by LG. It was provided for press usage. The graph has been done by Statista.
Source: LG press release
