LG on Monday announced it is closing down its mobile phone business worldwide. In a statement, the South Korean company revealed the decision was approved by its board of directors.
“LG’s strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services,” the company said in a statement.
The decision by LG is not surprising since the firm’s mobile phone unit has not been profitable for a while. In January, the company released a statement which stated it was reviewing the direction of its mobile business unit. The closure is expected to be completed by July 31 but it is expected the sales existing models will go on until the inventory lasts.
“Current LG phone inventory will continue to be available for sale,” the statement said. “LG will provide service support and software updates for customers of existing mobile products for a period of time which will vary by region. LG will work collaboratively with suppliers and business partners throughout the closure of the mobile phone business. Details related to employment will be determined at the local level.”
“Moving forward, LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to help further strengthen competitiveness in other business areas. Core technologies developed during the two decades of LG’s mobile business operations will also be retained and applied to existing and future products.”
TechCrunch reported how the company had fall way behind in the mobile industry in 2019 and how it was losing money. LG focuses on the mid-range and high-end mobile phone segment but the company has struggled to keep up with competitors like OnePlus, Xiaomi, Huawei, Oppo and Vivo.