LG has announced that it is closing its loss-making mobile business unit – a decision approved by the board of directors.
The tech company says this will allow it to “focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics, artificial intelligence and business-to-business solutions, as well as platforms and services”.
According to LG, it will still provide service support and software updates for customers of existing mobile products for a period of time which will vary by region and it will also work with suppliers and business partners throughout the closure of the mobile phone business.
Moving forward, LG says it will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to help further strengthen competitiveness in other business areas. Core technologies developed during the two decades of LG’s mobile business operations will also be retained and applied to existing and future products.
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According to BI analysts, Kevin Kim and Catherine Lim, “LG Electronics may position itself as an electric-vehicle component solutions provider, boosting its appeal to tech giants such as Apple, and also to traditional automakers aspiring to make ‘smart’ EVs.”
“Narrowing losses at its vehicle-components unit, to 2 billion won in the latest quarter, is a sign that it’s on track to a turnaround.”
The wind-down of the mobile phone business is expected to be completed by July 31 although inventory of some existing models may still be available after that.
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