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Samsung plunges into deeper crisis with problem-ridden Galaxy Note 7

[THE INVESTOR] Samsung Electronics has put a temporary halt on the production of its Galaxy Note 7 smartphone as the explosive battery issue is spiraling out of control.

An official from Samsung’s partner firm was quoted by Yonhap News Agency as saying that Samsung has temporarily stopped rolling out the Note 7.

The official added that the latest decision affects its facilities in Vietnam, Samsung’s manufacturing base for global markets. 


Samsung Electronics mobile chief Koh Dong-jin apologizes at a press conference held in Seoul on Sept. 2.
Samsung Electronics mobile chief Koh Dong-jin apologizes at a press conference held in Seoul on Sept. 2.


The tech giant is said to have consulted with state-run agencies in global markets for the production suspension, including the US Consumer Product Safety Commission and Korea Agency for Technology and Standards.

The company has not made any official announcement on news reports of the production suspension.

Samsung has found itself back in the hot seat following a number of reports of fire and explosions even in replacement Note phones with a new battery.

Over the weekend, US telecom carriers including AT&T and T-Mobile have halted the phone sales amid the ongoing battery fiasco of the handset.

They have also stopped exchanging old models with a replacement due to safety issues. They are now offering other Samsung phones or those made by other manufacturers for the replacement.

“Based on recent reports, we’re no longer exchanging new Note 7s at this time, pending further investigation of the reported incidents,” Fletcher Cook, vice president for global media relations, said in a statement.

“We still encourage customers with a recalled Note 7 to visit an AT&T location to exchange that device for another Samsung smartphone or any other smartphone of their choice.”

The suspension of the handset sales came on the heels of a series of alleged fires and explosions involving a replacement Note 7, including one that occurred on a Southwest Airline plane in Louisville last week.

Those alleged fire and explosion cases are still under investigation, but the mobile carriers have taken preemptive measures to prevent the troubling battery issue from getting worse.

A video footage of a Note 7 with billowing smoke at a Burger King fast food restaurant in Songdo, Incheon, went viral over the weekend.

It has not been verified if the fire was caused by the Note 7 and the handset was a replacement model.

Reflecting increasing concerns over Samsung’s latest flagship model which is marred in controversy, the firm’s shares dropped 4.57 percent to 1,628,000 won (US$1465.20) in morning trading on Oct. 10.

Making matters worse for Samsung, the US Court of Appeals for the Federal Circuit ruled last week in favor of Apple in a years-long patent suit with Samsung, overturning the verdict of a lower court.

In the lawsuit, Apple claimed Samsung infringed patents, including those for slide-to-unlock, and autocorrect features.

By Kim Young-won (wone0102@heraldcorp.com)
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