Chinese domestic smartphone companies have become a severe threat to all their smartphone competitors in China.
Just in, the Japanese multinational conglomerate corporation has decided to close its smartphone plant in Beijing in the next few days. The announcement was made by a company spokesman stating that the company plans to cut costs in the loss-making business.
Production moves from China to Thailand
Sony Corp. plans to shift production to its plant in Thailand in a bid to halve costs and turn the smartphone business profitable in the year from April 2020. When asked about the real reasons for this big decision, he said that the decision was not related to Sino-U.S. trade frictions.
Business has gone downhill
Sony has been in the smartphone business for quite some time now. But, unfortunately, the business is one of its few weak spots. The company had to suffer an enormous amount of 95 billion yen ($863 million) in the last financial year, ending this month.
Some analysts say Sony should sell the business amid acute price competition with Asian rivals. The company has a global market share of less than one percent, shipping just 6.5 million units this financial year mainly for Japan and Europe.
Sony believes that it can see this period of crisis through. The company has made it clear that it has no intention to sell the firm just yet. The financial experts at Sony expect smartphones to be central to technologies for fifth-generation wireless networks.
That left just three Japanese smartphone makers – Sony, Sharp Corp, and Kyocera Corp – in a global market dominated by Apple Inc., Samsung Electronics Co Ltd, and cheaper Chinese rivals.
Samsung late last year, also, said it would cease operations at one of its mobile phone plants in China. This announcement was made by Samsung as its sales in the world’s biggest smartphone market slumped. So, it surely is going to be a long and bumpy ride for Sony.