LG went from occupying the third place in the global smartphone market in 2013 not to appear among the main equipment manufacturers worldwide. After years of losses, the company will outsource the manufacturing of its low to mid-range cell phones to reduce costs.
LG announced the reorganization of its telephony division in an attempt to cut costs and compete with Chinese firms such as Xiaomi and Huawei, which have carved out a significant niche in the smartphone market in recent years.
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The company announced the reorganization of its telephony division, reports Reuters, this move will help LG to expand its mid-range offering more quickly and by lending the brand on products.
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A company spokesperson assured that this change in the outsourcing of the design and manufacture of smartphones will allow LG to focus on the premium and high range.
Counterpoint analyst Tom Kang told the news agency that the firm is still far from competing with companies like Apple and Samsung.
It knows it is competing with Chinese companies, not Apple or Samsung, and it is trying to increase the value of its low-end models for price, using OEMs that Chinese companies use. But even if LG gets its products, without marketing ability, it can’t win against Chinese companies that are good at it.
The research firm Counterpoint reports that since last year, LG has weakened against companies like Oppo, Xiaomi and Huawei.
This move is similar to the one Chinese electronics giant TCL made with the BlackBerry brand in 2016, after the company decided to stop making its own devices. This agreement came to an end in August this year.
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