Manufacturing Capacity and Innovation Projection for Samsung
Samsung is a South Korean multinational conglomerate based in Seoul. They have had their manufacturing units in six countries, namely, Vietnam, China, India, Brazil, Indonesia, and Korea. Recently, Prime Minister, Narendra Modi and South Korean President, Moon Jae-in have inaugurated Samsung Electronics Co. Ltd’s mobile phone factory in Noida. Spread over 35 acres, it is one the largest in the world. The new plant is estimated to produce 12 crore mobile phones every year.
Earlier, the company exported about 10% of the production output of about 5 million units per month. With the setting up of the new plant, the exports are likely to expand to 7 million units per month with regard to the export to Russia, Dubai, eastern European countries, and Africa. It is estimated that the company plans to increase its export to 30% by 2020. Currently, the company is working towards increasing its manufacturing capacity from about 67 million units to a whopping 120 million smartphones in Noida, India. The Indian market currently only manufactures about 10 percent of the overall production by the conglomerate. However, with the establishment of this new plant, it aims to increase production to about 50%. Most of the product is aimed towards the Indian Market and very little to be exported.
Given below, Table 1, is an expected trend that Samsung hopes to achieve in the near future in terms of increasing both its manufacturing capacity as well as its consumer base.
While much has been discussed about the manufacturing capacity, let us also look at some of the most important manufacturing plants of this South Korean Company. There has been a much obvious shift in the Manufacturing trends to be noted by the establishment of this new plant. Spread across the entire globe, it finds its main plants in Vietnam, China, India, Brazil, Indonesia, and Korea.
Currently, Vietnam is the leading producer with two manufacturing plants with a combined output of about 50% of the mobile phones, i.e., 240 million units, with further expansion plans. It is followed by China having a capacity of 150 million units which are most likely to be reduced in the near future due to the high labor costs. India currently has a low capacity but as discussed above, it is likely to touch a 120 million unit output in the near future. Samsung India also launched its ‘Make for the World’ initiative, wherein it aims to export mobiles produced in India to overseas markets. This region’s significance is attributed to the fact that Samsung’s first Tizen phone, the Z1, made its premiere here. The other plants in Brazil, Korea, and Indonesia have no current plans of expansion.
Samsung is known to have 335,155 patents of the 462,601 applications filed, the key markets for which are South Korea, the USA, and Japan. The USPTO has revealed that Samsung has outdone IBM in the highest number of Patents. As per reports from the Patent Journal IAM and intellectual property big data analysis company ktMINE, IBM had led this count for a while till the South Korean MNC owned 75,596 patents in the US which is one and a half times more than IBM!
Patent Disputes in the Past
In 2011, a Patent Infringement suit was filed by Apple claiming that Samsung has infringed its patent relating to Apple’s famous slide-to-unlock patent along with its quick links patent. Samsung was found to have infringed both patents. However, Samsung appealed from that decision wherein it had to pay $339 million and with the final verdict coming, Samsung has to pay a fine of $539 million to Apple.
New Anticipated Technology
With how Samsung is aiming to achieve the position of the best mobile company, the question arises of how it is seeking to compete in the world of mobile phones. Samsung has recently announced a foldable smartphone which is likely to introduce in 2019. As fascinating as it may sound, it is estimated to cost more than $1500! The phone is expected to have a 7-inch display that can bend in half to make it appear in the shape of a wallet. It is also to come with a much stronger battery to support this sort of output through multiple display screens. We can only hope they solve the issues relating to the battery explosions faced earlier in the endeavor of increasing their capacities. The anticipated design is likely to look like this as seen in a news report.