Samsung remains Vietnam’s largest exporter despite Galaxy Note 7 saga
An of Samsung Galaxy Note 7 at a mobile phone shop in Hanoi in October, before a global recall. Photo by Reuters/Kham
The Galaxy Note 7 saga has not affected the dominant position of the South Korean tech giant Samsung in Vietnam’s export sector.
Samsung Vietnam Deputy Director Bang Huyn Woo said that the company earned $39.9 billion from shipping electronics last year, up 10 percent against 2015.
The company also contributed 23 percent out of nearly $176 billion of Vietnam's export revenue.
This comes amid a loss of $122.6 million incurred by Samsung Electronics Vietnam in the third quarter of 2016, down sharply from a net profit of $490 million the year before.
The recall of Galaxy Note 7 in October affected production activities of two plants in the northern provinces of Bac Ninh and Thai Nguyen, which account for a combined 35 percent of all smartphones that Samsung supplies to the global market.
In recent years Samsung has helped turn the Southeast Asian country into an electronics manufacturing hub, with nearly $15 billion of capital investment.
The company has created jobs for around 140,000 Vietnamese workers. According to Samsung Vietnam, no job has been cut due to the Note 7 incident.
Twenty local enterprises have become Samsung’s component suppliers in 2016, with nine more expected to join in this year.
“The localization ratio in Samsung's products increased from 35 percent in 2014 to 51 percent last year,” Bang said.
In 2017, Samsung Vietnam is targeting an export growth rate of between 7 and 10 percent, urging the government to increase the overtime limit and control wage hikes.