Due to a series of reasons, global economic growth has begun to show signs of decline, and consumer spending has also declined, which can be especially reflected in consumer electronics. Therefore, major manufacturers are trying to find ways to deal with the problem of inventory.
Samsung Electronics has scaled back production at its large smartphone factory in Vietnam, employees said, according to Reuters. According to reports, as the world’s largest smartphone supplier, half of Samsung’s mobile phone production is produced in Vietnam.
In addition, the largest U.S. warehouse market is saturated, with major U.S. retailers such as Best Buy and Target Corp warning of slowing retail sales as shoppers begin to tighten their belts in the wake of the coronavirus pandemic.
The Vietnamese government said the impact was particularly pronounced in the northern province of Thai Nguyen. The province is one of Samsung’s two largest mobile device manufacturing bases in Vietnam. Samsung Electronics website shows that the park will ship about 270 million smartphones in 2021, and the park will have an annual production capacity of about 100 million units.
Pham Thi Thuong, a 28-year-old factory worker, said: “We will only work three days a week, and some production lines will be adjusted from six days a week to four days a week, and of course no overtime. ” Thuong and her friends who have worked with Samsung for about five years say they have never seen production cuts so severe. “Of course, there is a low season every year, usually around June-July, but the low season means no overtime, not a weekday, and no work as it is now.”
Plant managers said their inventory levels were already high, and new orders were low, she said. Reuters could not determine whether Samsung was moving production lines to other manufacturing bases to make up for production cuts at factories in Vietnam. The company also manufactures mobile phones in places such as South Korea and India. Samsung told Reuters it had not discussed lowering its annual production target in Vietnam.