Samsung Galaxy Note 7 Crisis Brings Down South Korea’s Industrial Output
South Korea’s industrial output fell in October as Samsung Electronics discontinued its latest flagship Galaxy Note 7 smartphones, a government report said on Wednesday.
Production in all South Korean industries dipped 0.4 percent in October as railway workers went on strikes, Xinhua news reported.
Production slid further from previous months according to Statistics Korea.
Samsung ending production and sales of Galaxy Note 7 led to an 18.1 percent decline in production of communication and broadcasting equipment in October.
Railway workers went on strikes amid the ongoing restructuring in troubled shipbuilders and shipping companies, further weighing down on the service industry.
Samsung Galaxy Note 7 was discontinued after several units of the device exploded, likely due to a battery issue. This led the company to not only recall and discontinue production of its flagship phablet, but also issue an apology to consumers, including a full-page advertisement in The New York Times. The Galaxy Note 7 discontinuation was soon followed by the recall of the company’s washing machines.
The company has said that the Samsung Galaxy Note 7 recall will cost it as much as $5.3 billion and its effects will be felt as far as the quarter ending March 2017. Samsung has offered Galaxy Note 7 buyers the option to exchange their unit with a Galaxy S7 or Galaxy S7 Edge, as well as discounts on purchase of Galaxy S8 and Galaxy Note 8 when they are launched.
Despite the threat of injury courtesy the exploding Galaxy Note 7, many Samsung customers still view the company in good light and would not be averse to purchasing its products again, including smartphones.