Engineer Emergency Dispatch Operation, Samsung and LG Strengthen Vietnam Production Bases

[Asia Economy Reporters Changhwan Lee and Gimin Lee] Samsung Group and LG Group are urgently deploying a large workforce to their production bases in Vietnam. As major production bases in countries such as India and Europe have shut down due to the spread of the novel coronavirus disease (COVID-19), they appear to be strengthening another key production base in Vietnam.

According to industry sources on the 24th, about 180 Samsung Display employees plan to depart for Van Don Airport in Quang Ninh Province, northern Vietnam, on the 28th via a chartered flight operated by Asiana Airlines. Van Don Airport is designated by Vietnamese authorities as the landing site for passenger flights from Korea instead of Hanoi Airport, and it is about a three-hour drive from Hanoi.

Composed mainly of engineers, Samsung Display employees will carry out modification work on the flexible organic light-emitting diode (OLED) module production line at a factory in Bac Ninh Province, northern Vietnam, separated from other employees.

They will stay in separate accommodations near the factory and will have no contact with outsiders. Samsung Display produces OLED displays for smartphones at the Bac Ninh factory, supplying major clients such as Samsung Electronics, Apple, and Huawei.

Samsung Display also dispatched about 180 employees to Vietnam in the first phase on the 13th. Vietnamese authorities reportedly recognized an exemption from facility quarantine after confirming that Samsung met COVID-19 prevention requirements.

Industry insiders believe that if Samsung Display engineers fail to carry out the production line modification work this time, there could be disruptions in the launch of new smartphone models for major clients in the second half of the year. However, the two-phase employee dispatch is expected to address the urgent situation for now.

LG Group is also sending employees to Vietnam urgently. According to the industry, over 200 employees from LG Electronics, LG Display, LG Innotek, and partner companies will depart for Vietnam on the 30th via a chartered flight operated by Asiana Airlines.

LG Electronics produces home appliances such as TVs, washing machines, air conditioners, vacuum cleaners, and smartphones in Hai Phong, a northern port city in Vietnam. LG Display also has an OLED module factory in Hai Phong, and LG Innotek has established a smartphone camera module factory there. Employees from each company are expected to undergo a two-week quarantine at local hotels before being deployed to each production base.

The reason Samsung and LG are focusing on the Vietnamese market is analyzed to be to maximize the utilization of Vietnamese factories, which still have production capacity, while major production bases in other countries are closed due to COVID-19.

Samsung Electronics is suspending operations at its Noida factory in India until the 25th in accordance with local government guidelines. LG Electronics has also decided to suspend operations at its production subsidiaries in Noida and Pune, India, until the end of March.

Samsung Electronics' Noida factory mainly produces smartphones, while LG Electronics' Noida and Pune factories produce home appliances such as washing machines. The Pune factory also produces some smartphones. Previously, Samsung Electronics also suspended its TV factory in Slovakia, Europe.

Recently, as major production bases in India and Europe have been closed one after another, the value of the Vietnamese factory, capable of large-scale production, has increased. An electronics industry official said, "Vietnam has not yet experienced a significant spread of COVID-19 compared to other countries," adding, "Vietnamese factories of domestic electronics companies such as Samsung and LG have become more important."

This content was produced with the assistance of AI translation services.