Samsung moves production to Vietnam in order to keep profit margins
High-end handset sales made by Samsung are slowing down, as per a recent Bloomberg report, which forces the manufacturer to look elsewhere when it comes to production, in order to protect its profit margins. “To secure even lower wages”, Samsung is opening a factory in Vietnam that will start production in February 2014.
It will reach full capacity production by 2015, at which time it will secure the production of 40% “of the phones that generate the majority of Samsung’s operating profit”, says Bloomberg. The information is also confirmed by a certain government issued statement from November 22, 2013. Shifting production to Vietnam, Samsung will join other companies, like Nokia and Intel, that are already producing products in said country. The move away from China is mostly due to “China’s higher labor costs”, according to Lee Jung Soon, from Korea Trade-Investment Promotion Agency.