For the local, Samsung Communications is undoubtedly a landmark existence.
Located near the company in the Xiqing District Microelectronics Industrial Park in Tianjin, there is more than one bus station named after “Samsung Communications”: on the Edison Road where the factory’s north gate is located, there are 826 buses stopping at this station, and the east side is Weiwu Road. There are 504 road signs with the same name – although within a few hundred meters, a group of “Samsung” companies, including Tianjin Samsung Vision, Tianjin Samsung LED, etc., “Samsung Communications” has become the representative of this film.
Standing side by side with the “Tianjin Samsung Communications” on the roof of the main building of the factory is the “Samsung Smartphone”, which also implies the real role of the factory.
Born in 2001, with a registered capital of 104 million US dollars, Samsung Communications, a joint venture between Samsung Electronics Co., Ltd. and Tianjin Zhonghuan Electronic Information Group Co., Ltd. (hereinafter referred to as Zhonghuan Electronics), has always been the “first mover” of Samsung mobile phones in China.
In fact, in the second year of the factory’s establishment, Samsung mobile phones began to enter the Chinese market. Subsequently, relying on many advantages such as shape, technology, screen, etc., Samsung mobile phones began to stabilize their market position.
“I am here at the company, and I have experienced the whole process from rapid development to glory, then to decline and now closed.” As an old factory employee, Yang Lin had ample reason to be proud. He told the 21st Century Business Reporter, “2013 is a factory. In the most brilliant year, the monthly output is up to 10 million units.”
At that time, Samsung mobile phones are also catching up with the wave of smart machine replacement, and the models represented by Samsung Galaxy series mobile phones frantically seize the market. According to researcher Counterpoint, Samsung’s mobile phone market share in China was 20% in 2013, ranking first.
However, after that, Samsung mobile phones entered a bottleneck in the Chinese market and lost ground. Correspondingly, the output of Samsung Communications is also declining.
According to data provided by IDC China to 21st Century Business Herald, Samsung’s annual market share in China was 5.5% in 2016, less than 3% in 2017 and 0.9% in the first three quarters of 2018.
Even Samsung’s global smartphone sales have begun to weaken. According to Gartner data, in the third quarter of this year, Samsung smartphones shipped a total of 73.306 million units, down 14.3% from the 85,560,300 units in the same period last year. Samsung’s share of global smartphone shipments in the quarter also fell to 18.9% from 22.3% in the same period last year.
The decline in sales means that the intention to control costs is even more urgent.
“The production of Samsung mobile phones is gradually shifting to factories in Huizhou and Vietnam, China.” Many Samsung employees told 21st Century Business Herald.
According to previous reports from South Korean media, Samsung Electronics’ annual production capacity in the two factories in Beining and Taiyuan, Vietnam, is 240 million units, while the Tianjin plant has an annual production capacity of 36 million units and the Huizhou factory has 72 million units.