If you own a Samsung smartphone, it was most likely manufactured in a plant in Vietnam. That, however, is likely to alter in the future. According to reports, Samsung aims to lessen its reliance on Vietnam for new device manufacture. According to The Elec, the corporation is considering India and Indonesia as alternative Asian production hubs, with India likely to benefit the most from a future relocation. According to reports, the proposal entails rearranging production capacity over seven separate manufacturing locations located around Asia.
As of 2021, Vietnam will account for 60% of Samsung’s global smartphone production capacity, followed by India (20%) and Indonesia (4%). The company owns two manufacturing plants in Vietnam, with a total annual capacity of 182 million smartphones. Samsung hopes to reduce this number to 163 million handsets per year by next year.
In comparison, India, where Samsung has a single factory, produces 60 million units per year. Samsung hopes to grow that figure to 93 million units per year by 2022. This makes sense given that Samsung’s manufacturing facility in India is billed as the world’s largest mobile factory. It was dedicated in July of 2018.
Prior to the pandemic, Samsung planned to raise its production capacity in India to 120 million devices. That, however, did not occur, and it appears that Samsung would settle for a considerably lower figure of 93 million devices per year in India in the near future. Samsung intends to produce 19 million more units in India by the end of 2022. In Indonesia, where Samsung now produces 10 million units per year, the company plans to raise production to 18 million units per year.
Even after Samsung completes its restructuring, Vietnam will continue to produce 50% of its smartphones. India’s part will rise to 29 percent, while Indonesia’s share will rise only little to 6 percent. Samsung has set aside $140 million to support this expansion, with $90 million going to India and $50 million going to Indonesia.
According to the article, Samsung’s plan to rearrange its manufacturing strategy is partly due to rising labor costs in Vietnam. The corporation was also severely harmed by COVID-19-induced lockdowns in Vietnam, which resulted in lengthy factory shutdowns.