LG announced it will no longer be producing smartphones per a decision by its board of directors. According to a prepared statement released on April 5, the move to get out of phone manufacturing and sales will allow the company to shift resources to other future technologies, like artificial intelligence, robotics, and smart homes.
The announcement comes only a few months after a presentation at CES 2021 where the South Korean company revealed a new rollable phone design. That new design was expected to come out some time this year, but will be shelved following this announcement, though the technology is likely to be utilized in future LG products.
Kwon had previously promised to turn the division around at a press conference at CES 2020: “LG Electronics Mobile is going to be profitable by 2021.” That statement was not long after the release of LG’s Velvet and Wing phones, both ambitious smartphones released in a final bid to rebrand the South Korean company as a design leader, as it was in the early- to mid-2000s. However, neither device has been able to revive the company’s global phone market share, which has steadily dropped over the past six years. LG’s current market share sits at an all-time low for the company at 1.7%.
Rumors that LG was getting out of the phone game have been circulating since January, when the company’s CEO Kwon Bong-seok told The Korea Herald that the time had come for LG “to make a cold judgment” about the future of their loss-making mobile division.
Consumers won’t be affected by the mobile division shutdown for at least a few months. All current phone inventory will still be sold, and LG has promised it will continue to provide software updates and customer support for LG smartphones for a period that will vary by region. Its mobile division will cease all operations by the end of July, though LG notes that stores could continue selling leftover smartphone inventory long after.
