Samsung to shift operations to Vietnam after ending Tianjin TV production

Samsung is expected to shift parts of its TV production to Vietnam following the closure of its sole China TV factory in Tianjin at the end of November, Nikkei Asian Review reported.

Samsung is expected to move part of its TV production to Vietnam from China. Photo: Reuters.

The move is part of a greater trend of businesses shifting supply chains away from China, stated Nikkei.

Samsung, the world's top seller of flat-screen TVs, has been losing market share in China due to the rising quality of local competition as well as boycotts triggered by Seoul's decision in 2016 to deploy a US-developed missile shield over Beijing's objections. Labor costs also have been rising in China.

The Tianjin factory, which opened in 1993, employs about 300 people after several rounds of downsizing. Samsung plans to reassign these workers to other facilities or help them find new jobs as part of the closure.

Samsung also shut its smartphone factories in Tianjin and the southern Chinese city of Huizhou before the end of 2019, and the company said in June that it would cease production at a computer factory in Suzhou, for which Vietnam would also be the alternative destination.

Samsung still operates an appliance factory in Suzhou and two chip factories in Xi'an.

In the 2008 – 2018 period, Samsung increased its total investment in Vietnam from US$670 million to over US$17.3 billion, a 26-fold increase. 

In early March, Samsung Vietnam started construction its largest R&D center in Southeast Asia in the west of Hanoi at a cost of US$220 million. The company expected Vietnam would not only be its largest production hub, but also a strategic base for R&D.