Samsung Is a Case Study in How Manufacturers Leave China

wsj.com

16 pointstooltalk2 comments

> Lower labor costs in other Asian countries are a big draw. But geopolitics was probably also an important factor. In 2016 and 2017 Beijing and Seoul became embroiled in a major diplomatic spat over South Korea’s plan to host a high-tech U.S. missile defense radar system.

The most interesting part of the story got only 2 sentences.

Why exactly did the decision of the ROK government to install a US missile system negatively affect Samsung's electronics operations in China, consisting primarily of smartphones?

I don't see a logical relationship.

Agree that the 2016 THAAD brouahaha probably wasn't a major factor. Samsung reached #1 in China smartphones sales in 2013 and already quickly dropped to a small single digit a few years later well before the THAAD crisis kicked in 2016.

I think it's convenient to blame THAAD for the souring relation between South Korea and China, but it's really ex post facto. I think it's partly b/c many still refuse to believe that Samsung was forced out by China to make room for domestic smartphones makers such as Huawei, Oppo, etc.. as part of their well planned industrial policy to protect and nurture their own domestic competitors. The company managed to remain #1 in globally well over a decade now in spite of this. There were also other South Korean companies such as Hyundai/Kia who once topped Chinese auto market with 10% of the market share, now down to a dimunitive number -- their global rank increased from #5 to #3, only after VW and Toyota during the same period that they were outsted. As pointed out in the article, Apple bribed $275+B their way to stay in the game.

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