[NDNNEWS=Jung Jin-kyu] Samsung Electronics is going to lower the proportion of smartphone production in Vietnam to mid-40% next year. It will distribute risks by reorganizing production bases that were concentrated in Vietnam by more than 50%. It will maintain its domestic production system of flagship products such as foldable smartphones and Galaxy S and strengthen its role as "mother factory." Samsung Electronics has established a plan to produce 46% of all mobile devices in Vietnam's Tai Nguyen and Bac Ninh provinces next year. Mobile devices include smartphones, tablet PCs, and feature phones. Smartphones account for 90% of the total. It produces 32% in Tai Nguyen Province and 14% in Pak Nin Province. This year, Samsung's smartphone production in Vietnam exceeded 50% of the total. The year before last, it was in the 60s. The figure will fall to the 40 percent range from next year.

The reason for reducing the proportion of Vietnam and distributing production around the world is to minimize damage when uncontrollable external factors such as infectious diseases occur. The goal is to create a system that enables alternative production in other regions quickly even if certain factories are closed. Samsung Electronics also recommended major suppliers to diversify their production systems by global production plants.

There is also a natural decrease in the proportion of Vietnamese factories with the highest production capacity as smartphone shipments overall decreased. Samsung Electronics has been continuously lowering its operating rate in Vietnam recently. Considering the global economic downturn and weak consumer sentiment, Samsung Electronics has set a conservative goal of producing less than 300 million smartphones next year.

The reduced proportion of Vietnam is distributed to India, Indonesia, and Latin America. India is the second largest producer of smartphones. It accounts for 21% in India, 7% in Brazil (Manaus and Campinas), 3% in Indonesia and 1% in Turkiye. The Gumi plant will continue to serve as a flagship production control tower, responsible for 3% of the total mobile volume. The Gumi plant, the only Samsung smartphone production base in Korea, is a "mother factory" that applies new process technologies in advance and spreads them to global production bases. It is in charge of domestic supplies of flagship products such as foldable smartphones and Galaxy S. According to next year's production plan, the Gumi plant has the largest production volume in January, when the next flagship smartphone, the Galaxy S23, is just around the corner, and in August when the new foldable smartphone is released.

China's joint development and production (JDM) volume will also increase significantly. JDM refers to a method of consignment production of products designed by Samsung to suppliers. It mainly makes low- and medium-priced products in this way. Next year, 60 million JDM smartphones are expected to account for 18% of the total.