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Samsung may slow down its smartphone manufacturing in preparation for the impending recession

A global recession, as predicted by market experts for some time now, is reducing the evidence of post-pandemic expenditure booms. Samsung is unwilling to accept the consequences of changing customer habits on its product line and manufacturing plans, despite the fact that it makes some of the finest Android devices. But a new claim based on insiders’ information implies that the brand had to decrease manufacturing because of poor sales.

When it comes to smartphone sales in the second half of 2022, Samsung’s two factories in Vietnam may be telling a different tale than what the firm had previously predicted. Together, they manufacture half of the company’s phones each year, with the Thai Nguyen plant alone producing 100 million handsets each year. Some manufacturing lines are only operating three or four days a week instead of the customary six, and working overtime is not an option, according to conversations with plant employees.

Samsung’s operations may be slowing down, if its employees are to be believed. However, according to Reuters, the corporation may be able to compensate for the loss in output by using facilities in India and South Korea. In Vietnam, the firm allegedly has no intentions to lower its yearly output goals.

Reduced employment and compensation are also a worry for those working in the Vietnam factory. Google, Meta, and other major IT companies have curtailed employment, but Microsoft and Netflix have cut positions, blaming the decrease in consumer spending and the impending recession for the layoffs.

This might be seen as a sign that Samsung is bracing itself for smaller client expenditures in the low and mid-range product categories. However, after rumours of hoarding of low-cost models, the business may shift its attention to high-end models like the Galaxy S series and forthcoming ones like the Z Fold 4 and Flip 4. The company’s most recent Q2 earnings report indicates a profit of 12 percent. In order to keep up with Apple, preserve market share until the recession ends, and maintain high profit margins, the corporation should make this step.