#Samsung Electronics closes the last computer factory in China#
South Korean tech giant Samsung said on Saturday local time that it would suspend operations at its last computer factory in China to adjust its manufacturing operations. About half of the 1,700 contract workers at Samsung's Suzhou computer factory will be affected, excluding those involved in research and development, according to a notice sent to employees on Friday.
"China remains an important market for Samsung, and we will continue to provide Chinese consumers with high-quality products and services," the company said in a statement. Samsung closed its last smartphone factory in China last year, and its remaining facilities include two semiconductor manufacturing bases in Suzhou and Xi'an.
According to public information, Samsung SESC was established in September 2002 with a paid-in capital of US$13,433,713, and its actual controller is (Korea) Samsung Electronics Co., Ltd. Since it was officially put into production in April 2003, Samsung SESC has been responsible for the R&D and manufacturing of notebook computers. According to early reports, the original intention of the construction of Samsung SESC is to make Samsung China the second business base of Samsung (Group). In May 2005, Samsung SESC became Samsung's only overseas notebook computer research and development and manufacturing legal person.
There are different opinions in the market about the reason why Samsung shut down Samsung SESC. Some analysts said that Samsung may relocate low-end production links to Vietnam to reduce labor costs. Some analysts also said that Samsung's withdrawal was due to its dismal performance in the Chinese market. But it is undeniable that, with the rapid rise of domestic brands, Samsung's retreat in China has long been foreshadowed.
In October 2013, CCTV's "Economy Half an Hour" broadcast a program: Samsung's "sudden death" problem has spread all over the world, but after-sales services vary from place to place. The program survey pointed out that Samsung mobile phones often have problems, but in the UK, repairs or replacements are free within the warranty period;
Frequent mobile phone accidents, strong response attitude, and after extensive exposure by the media, consumer dissatisfaction has continued to accumulate, and the subsequent "Note7 incident" has aroused public anger and led to the defeat of Samsung's mobile phone. In 2016, Samsung Note7 had frequent battery explosion incidents. Samsung conducted a global recall, except for the Chinese mainland market, and argued that there was no problem with the mobile phones in the Chinese market.
The result is conceivable. In the golden 10 years of the rapid rise of domestic mobile phones, Samsung's "arrogance" destroyed the Chinese market's trust in its mobile phone brands. With the maturity of Huawei, Xiaomi, and OPPO mobile phone brands, although Samsung is far ahead in global mobile phone sales, it has lost the world's largest market-China.
It should be noted that regarding Samsung’s closure of the Suzhou factory this time, Cao Heping, a professor at Peking University’s School of Economics, said that China established its own comparative advantages in labor-intensive and low-end industrial chains in the early years, and then moved to the middle and high-end industrial chains.
Chinese consumers consume much more mobile phones than computers, and Samsung's "turn around" this time shows that the traditional computer era has completely given way to the smartphone era. However, some countries, such as Southeast Asia, still have 600 million people, and they still need the eliminated production capacity of computers and low-end mobile phones. For China, industrial policies and foreign investment policies should also be appropriately adjusted and transformed in accordance with different stages of economic growth.
In addition, regarding the resettlement of the affected employees, Liu Hongqun, deputy director of the Park’s Labor and Social Security Bureau, said that the park had comprehensively communicated with Suzhou Samsung Computer in the early stage to guide the company to actively communicate with employees, listen to employees’ opinions, and properly handle labor relations through consultations in accordance with the law to protect the legitimate rights and interests of employees. In the next step, the labor department will actively carry out employment assistance and go all out to help relevant personnel achieve re-employment. The company will also arrange special job fairs through resources such as related agencies and cooperative units to help affected employees re-employ.
