South Korean tech giant LG Electronics is struggling in the smartphone business, and the highly competitive market might even force the company to wrap up its spread soon. LG CEO Kwon Bong-Seok has reportedly indicated the employees regarding their exit from the smartphone market in 2021. As reported by The Korea Herald, LG Electronics has lost about 5 trillion won or $4.5 billion in the past five years in the smartphone arena. Addressing the increasing difficulties to compete with rivals, the LG head has written an internal note addressed to the employees.
Although a major decision is impending, the CEO has assured all workers that their “employment will be maintained,” so there is no need to worry.
Citing competition in the market getting “fiercer,” an LG official has revealed to the portal that the company is currently “considering all possible measures” to tackle the slump. These measures include the “sale, withdrawal, and downsizing of the smartphone business.”
The official further said: “Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice.”
A company spokesperson has confirmed that this internal memo is, in fact, genuine to tech portal The Verge. The said spokesperson also maintained that “nothing has been finalized.”
Earlier, Korean outlet TheElec had leaked an internal memo of LG to state that upper management had instructed the employees to stop working on developing any of the phone projects. Saying that a final decision will be announced by the end of January, it was said that work on the rollable phones would be continued only. However, LG’s global communicator Ken Hong confirmed that the memo reported was entirely false to Android Police. TheElec has since then deleted the report.
As LG offered a glimpse of its first rollable phone at CES 2021, this will be expected to be one of the last smartphones developed by the firm.