LG might shut down its struggling smartphone business
The mobile division may close for good after accumulating operating losses of nearly £3.2 billion in 2020
LG Electronics is considering selling or potentially even shutting down its struggling mobile business, according to industry insiders.
The company was in negotiations with Vingroup of Vietnam and Volkswagen of Germany but hasn’t made any notable progress, The Korea Herald reports.
"LG reportedly had talks with others over the sale of the unit but apparently there was not much progress in their negotiations," an official in the mobile industry said on condition of anonymity to the publication. "It seems that selling its entire mobile business appears to be difficult at this moment, as is the partial sale of the unit."
Since the second quarter of 2015, LG’s mobile business has been in the red and it accumulated operating losses of nearly 5 trillion won (£3.2 billion) last year.
As its restructuring plan has been apparently running in place for two months, industry trackers now believe that the company may be leaning towards the option of closing down the mobile unit.
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IT Pro has contacted LG for comment.
LG impressed CES attendees in January with its new handset with a “rollable” display which might also be in jeopardy, with the company reportedly ceasing the development of the smartphone.
The company should reveal more of its plans for its smartphone business next month when it has a board meeting, according to reports.
In January, there was confusion as LG both verified and denied rumours suggesting it was looking at potentially shutting down its smartphone business.
"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," an LG official said, according to The Korea Herald. "The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business."
This was then verified and denied by different publications, where LG gave out different statements confirming and denying the rumours.