Reasons Why Samsung Cuts Phone Production This Year

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Samsung is reportedly reducing the number of phones it plans to produce this year. From 310 million to 280 million. The news was obtained by SamMobile, citing a report by the Korean media Maeil Business News.

Judging by the numbers, 280 million still sounds like a lot, but it's a relatively sharp drop from the company's original goals and from the number of phones it and its partners were reported to be producing last year. It seems that there is a tendency for producers to prepare themselves for economic conditions that are expected to worsen.

Factors causing the decline in Samsung's production

The four main factors for the decline in Samsung's production are rising inflation, the impact of consumer spending, plus ongoing component shortages and the war in Ukraine. Reportedly, the decline in production targets will affect the entire range of phones, from low-end to high-end models.

Unfortunately, cutting the number of production of cheaper phones may not be the right choice. The reason is, more people will switch to cheaper cellphones during economic times.

Samsung is not the only manufacturer feeling the effects of the ongoing pandemic. Apple is also reportedly predicting relatively flat sales this year, as it plans to produce the same number of phones as in 2021, although the company is working on some sizable upgrades.

Photo Source: Pixabay

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