Now it’s official: LG announces it will leave the cell phone market in 2021

Now it’s official: LG announces it will leave the cell phone market in 2021
Now it’s official: LG announces it will leave the cell phone market in 2021

After many speculations, LG officially confirmed on Monday (5) that it will even abandon the cell phone sector.

In an official statement, the brand says that the decision to leave the “incredibly competitive mobile phone industry” will allow it to focus on other segments, such as components for electric vehicles, connected IoT devices, smart homes, robotics and artificial intelligence, in addition to of platforms and services for companies (B2B).

Activities such as customer support and software updates will remain “for a period of time” that varies by region, with specific announcements to be made over time.

With the departure, it is possible that the company’s “rollable” screen smartphone project, the LG Rollable, will no longer pass the prototype phase. It was first shown in January 2021 and was scheduled for release this year.

The last models actually launched by the South Korean were the experimental LG Wing, the elegant LG Velvet and the intermediates LG K52, K62 and K62 +.

Long novel

Rumors about LG’s exit from the market were reinforced from 2021, when a report stated that the LG Rollable, the company’s rollable smartphone project, would have been paralyzed because the entire segment would be abandoned.

At first, brand executives denied that the information was true, but more and more sources were coming up with new details. At the end of last year, it had already outsourced the production of intermediate smartphones.

One of the reasons that delayed the departure was the attempt to sell the division to an interested party, but no buyer was found. Xiaomi is one of the companies that, according to the local press, will try to absorb the market share in regions where the brand was still strong.

The mobile division of the brand had suffered losses for years, but the company was optimistic about a turnaround.

And now?

The division will be definitively deactivated on July 31, 2021, but not all questions have already been answered by the company.

The factories for the production of smartphones in Vietnam and Brazil have an “uncertain” future – they can be closed permanently or transformed to produce other items. New announcements are expected to be issued in the coming weeks.

Official statement

In contact with TecMundo, LG explained its reasons for leaving the cell phone market, indicating mainly losses. Check out:

Since the second half of 2015, our global cellular business has suffered an operating loss for 23 consecutive quarters, resulting in an accumulated of approximately $ 4.1 billion until the end of 2020. After evaluating all the possibilities for the future of our cell phone business, Headquarter Global decided to close this division in order to strengthen its future competitiveness through selection and strategic focus. As a company that deeply values ​​the contribution of every LG employee, customer and partner, we will communicate openly and transparently during this process, seeking a fair and pragmatic approach, while meeting legal obligations. It is with sadness that we share this news with our customers and partners who throughout all these years have shown us confidence and supported us.

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