According to a new report Samsung appears to be more cautious towards investing in production facilities of mobile phone components, it’s adjusting existing facilities in Vietnam following expansion in production capacity until the first quarter of this year. With sales of the Galaxy S6 dwindling in Q2 Samsung has reportedly stopped purchasing more computer numerical control (CNC) milling machines which is an important piece of equipment when producing metal cases for smartphones.
The industry saw Samsung put a lot of money into CNC machines last year before the mass production of the Galaxy S6, with analysts saying that thousands of machines were installed in the factory in Vietnam, machines that can cost as much as $88,000 per unit. Rumor has it that the company might sell off some of its component manufacturing facilities in Vietnam and Korea to its affiliates, it’s expected to offload the Samsung Fiber Optics’ camera module business to Samsung Electro-Mechanics. Industry watchers are of the view that Samsung’s adjustment in production capacity is probably brought on by the Samsung Group’s efforts to overhaul the organizational structure of its electronics subsidiaries.
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