Samsung, as the pillar of South Korea's economy, has been operating in the Chinese market for many years, but it has suffered a significant loss of 95% of Samsung's revenue due to the chip business3%！
Crash" also indirectly led to the decline of South Korea's GDP, for which South Korea angrily denounced Samsung:"This is the end of going against China! ”
So, how exactly did Samsung get into such a predicament?
Samsung used to be the world's largest smartphone manufacturer, and its semiconductor business is also booming, however, in recent years, in the Sino-US chip war, Samsung has become the "cannon fodder" of the United States against China.
As a result, Samsung had to withdraw from the Chinese market, thus turning the battlefield to the United StatesHowever, the construction of factories in the United States has also encountered technological plunder, and has suffered from the "use" of the United States.
In 2020, after the United States banned the export of chips to Huawei, Samsung also followed suit and stopped supplying to Huawei, as the world's top memory chip manufacturer, Samsung chips had a direct impact on Huawei's embargo.
This decision also cost Samsung itselfIn the third quarter of 2022, Samsung's memory chip sales fell by more than 30% year-on-year, and Samsung, which was centered after the construction of the factory, also led to a continuous decline in the market share of mobile phones in China.
At this time, the United States also threw out the trap of "investment promotion" to Samsung, in order to strive for the chip factory subsidies provided by the United States, Samsung plans to invest $17 billion in the United States to build factories.
But in the end, the money was not obtained as expected, and all the subsidy funds were eaten by American companies like IntelIn addition, the United States also pressured Samsung to hand over its core technology, which Samsung refused.
Under the double pressure, Samsung's performance in 2022 plummeted, with a year-on-year increase of 99% in the second quarter.
In this Sino-US chip war, Samsung can obviously make money on both sides, but it is too dependent on the United StatesFalling victim to other countries' companies is undoubtedly a painful lesson for Samsung.
In fact, long before the United States launched the chip war,Samsung is already "de-Chinese".
With the rise of domestic mobile phone companies such as Huawei, Samsung's market position is even more precariousIn response to changes in the global strategic environment, Samsung began to adjust its strategy in China.
Because of the Samsung Note 7 battery ** incident that happened from 2016,The brand image of Samsung's mobile phones fell to the bottom, and Samsung did not recall the problematic phones in the Chinese market in a timely manner, further damaging the trust of Chinese consumers.
In stark contrast, Huawei's global market share is rapidly catching up with Samsung, which is rapidly catching up with Samsung, according to the data, which has slipped from 20% in 2015 to less than 1% in 2021It is expected to soon surpass Samsung to become the number one in the world.
Faced with the dilemma of a sharp decline in market share, Samsung made a strategic adjustment, and around 2017, Samsung proposed to reduce its dependence on the Chinese market and invest more resources in developed markets such as North America and Europe.
At that time, Samsung's dependence on the Chinese market was as high as more than 50%.This was considered too risky within the company, and in the semiconductor business, Samsung has also begun to shrink orders from Chinese customers.
Since then, Samsung's mobile phone business has begun to consciously slow down its investment, production and sales in ChinaIts market strategy has also changed from covering the whole country to focusing on first- and second-tier cities, and has abandoned many county markets.
In the field of semiconductors, Samsung has also begun to shrink orders from Chinese customers, and these measures have led to a continuous decline in Samsung's market share in China, which has been caught up by Chinese manufacturers such as Huawei and Xiaomi.
On October 3, 2019, Samsung announced the closure of its last mobile phone factory in ChinaTo this end, Samsung said that this is mainly to improve production efficiency and transfer production capacity to emerging markets such as India.
It can be seen that Samsung's final closure of the factory in China is more due to the adjustment of the company's global strategic layout, rather than simple cost considerations.
In 2020, after the United States "cut off supply" to Huawei, it is logical for Samsung to choose to follow suit, as the world's semiconductor leader, Samsung could have been left and right, but in the end it chose to stand in lineIt has become the "blade" of the United States against China.
As a result, Samsung not only lost the Chinese market, but also suffered from technology plunder in the United States, which cost a lot, and all signs show that Samsung's top management has a serious bias on its China policy, which may continue to hinder its China business development, and if Samsung wants to reopen the Chinese market in the future, it needs to deeply reflect and adjust its China strategy.
For Samsung's current situation, the Korean media angrily denounced:The end of going against China.
Samsung Group once stood at the top of the world's technology like a king, but now it has fallen into recession and trouble, and one of the most important turning points is that Samsung chose to oppose China.
China has given Samsung huge support and resources, and Samsung has also made great progress in 1992Samsung entered China after decades of hard workWith a cumulative investment of more than 300 billion yuan in China, which once accounted for nearly 20% of its global revenue, it can be said that without China's huge market and industrial chain, there would be no Samsung today.
However, the good times did not last long, in the Sino-US war and the chip war, Samsung chose to side with the United States, and did not hesitate to be the enemy of ChinaThis decision ruined Samsung's long-standing foundation in China and made it decline in the Chinese market.
As a former partner, Huawei has given Samsung a lot of helpBut when Huawei was sanctioned by the United States, Samsung not only did not support it, but followed the steps of the United StatesStop supplying key technologies and components to Huawei.
This is undoubtedly a move to deceive the husband, and Samsung's actions have aroused strong dissatisfaction among the Chinese peopleSamsung's brand image plummeted.
The rise of China's local enterprises, but also the formation of a huge competitive pressure on Samsung, in the face of domestic brands to catch up, Samsung is still going its own way, adhere to the high-end strategy, completely ignoring the changes in the needs of Chinese consumers, its market share in China's mobile phone market has declined rapidly, by Huawei, Xiaomi and other brands far behind.
To add insult to anger, Samsung has repeatedly antagonized China on issues that affect China's core interests, and when South Korea deployed THAAD in 2016, Samsung not only had no objections, but also actively supported it, leading to a wave of Chinese boycotts of its products.
There are signs that Samsung no longer sees China as an important partnerInstead, it has been targeted as a competitor and a target for sanctions, a hostile stance that has dimmed Samsung's prospects in China and a shrinking market.
In 2022, Samsung's revenue share in China has dropped to 117%, a record low,Revenues have plummeted, and there has been a brain drainThe channel relationship has broken down, and its strategy of insisting on going its own way and singing the word about China has obviously failed.
"Those who are frivolous will insult themselves, and those who hold profits will last for a long time", Samsung's experience is a confirmation of this ancient adageThe misplaced choice under the short-term interests has made it pay a painful price, and unexpectedly, Samsung has become the biggest loser in this Sino-US game.
Samsung's failure in the Chinese market is also related to its own management and strategy problems, for example, there are serious heir problems within Samsung.
Since Lee Kun-hee took over, excessive centralization has led to Samsung's lack of innovation and lackluster product iterationIn addition, there is also serious infighting in the management of Samsung, in which the competition between the various BU is too fierce and the internal friction is serious.
The most serious thing isSamsung's China marketing team is seriously disconnected from its headquarters, a lack of keen judgment on the local market, these problems have caused Samsung to continue to lose points in the Chinese market.
In the face of Samsung's dismal performance in the Chinese market, there are also strong voices of reflection in South Korea, and many experts and scholars believe that Samsung must re-examine its China strategy.
Simply following the U.S. strategy will not only damage China-South Korea relations, but also Samsung's own interests, some people point outSamsung should get rid of its dependence on the United States, regain the spirit of technological independence, and re-establish a strategic partnership with ChinaIn this way, Samsung will be able to reopen the Chinese market and regain its development momentum.
Despite the bumpy road, it's not too late for Samsung to turn around and rebuild its competitiveness in ChinaIt is hoped that Samsung will learn from its lessons and take decisive measures to revive its business in China.
China's vast market and strong industrial support force still give Samsung a huge space for development, the key is to see whether Samsung can correctly understand the situation, adjust the strategy against China, and win-win cooperation with ChinaIt is inevitable to be eliminated by the times.
Samsung's predicament is worth pondering, and China-South Korea relations are at a crossroads in historyWe need to prevent it from going down the wrong path of confrontation, because as Asian countries, we should work together, not hostile to each other.
But be wary of the consequences of luring wolves into the house. It is expected that the two sides can show strategic wisdom and find a win-win strategy for both sides, and whether Samsung can regain its strength is still an unsolved mystery, so let's wait and see. (*From the Internet, infringement contact deleted).