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| Samsung Electronics semiconductor factory in Xi'an, China / Courtesy of Samsung Electronics |
By Kim Hyun-bin
Samsung Electronics' Chinese operations and workforce are showing evidence of decline, reflecting a possible move to reduce reliance on China. Its legal battle against BOE, a leading Chinese display company, is likely to add haste to the China exit.
According to Samsung Electronics' sustainability report released Friday, the total number of non-executive employees in China decreased from 599 in 2020 to 527 in 2021 and further to 477 in 2022. This contrasts with the continuously increasing numbers in Southeast Asia, Southwest Asia, and Japan, which went from 3,590 in 2020 to 4,305 in 2021, and 4,583 in 2022.
The number of executives also decreased, going from 18,099 in 2020 to 17,891 in 2022. Its revenue in China also sharply declined to 35.6 trillion won ($26.9 billion) in 2022 from 45.6 trillion won in 2021.
Its business establishments in China are also decreasing. According to a corporate analysis by the Korea CXO Research Institute, Samsung Electronics reduced the number of subsidiaries in China to 65 this year from 87 in 2018, a reduction of 22 percent over five years.
Samsung Electronics is also engaged in a legal battle with BOE. It has halted all new development projects with BOE and is also trying to replace LCDs used as TV panels. Recently, Samsung Display filed a lawsuit against BOE in the Eastern District Court of Texas, claiming that BOE infringed on its organic light-emitting diode (OLED) patents for smartphones. The technology being contested encompasses four OLED display patents used in all iPhones after the iPhone 12.
"Amid intensifying competition recently, theft and infringement of intellectual property, which is the foundation of our competitiveness, have been increasing," Choi Kwon-young, executive vice president at Samsung Display, stated during the Q2 earnings conference call, "We have determined that this has reached an undeniable level, and as a result, we are pursuing various measures including legal actions."
