LG considers leaving the mobile market: its CEO is fed up with constantly losing money

LG considers leaving the mobile market

” It is time to make cold decisions,” said LG CEO Kown Bong-Seok in an interview with The Korea Herald. The company has been losing money with its smartphone division for six years, and it seems that those responsible are saying goodbye to this business.

The CEO spoke of the fierce competition that exists in this market, and even made comments that raise a “sale, abandonment or reduction of the smartphone business.”

Retreat on time is a victory?

Kwon took over the reins of LG a year ago and then made a singular promise: that the company’s mobile division would be profitable in 2021. To achieve this, he said at the time, he would come up with ” surprising form factors to surprise users.”

Those form factors don’t seem to have come together. The LG Velvet and the LG Wing are certainly surprising, and at CES they briefly showed their LG Rollable, the also unique mobile with a roll-up screen. The first two should not be working in sales as the company expected, and that has caused the CEO to now raise that decisive reflection.

LG’s market share in this market does not appear to increase (it is only 1.7% according to data from StatCounter ) and these niche devices do not help to strengthen that presence.

LG’s CEO already began to envision a different future for his division in December 2020. The company would delegate the production of its entry-level and mid-range mobiles to third parties and its internal division would devote all its efforts to high-end devices.

This new comment leaves the future of all that strategy in question, and certainly, after six years of losses in this business, it seems logical to think that perhaps it is better to retire in time.

The decisions that LG has made to re-launch this division are not working at the moment, and the difficult competition with Samsung in South Korea and with Chinese manufacturers seems to be too much for a company that, of course, has always tried new things.

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