Samsung India denies it has laid off 1,000 of its employees in India

Topics Samsung | Employment | Technology

Samsung Galaxy Tab S5e
Korean electronics giant Samsung on Tuesday denied reports that it had laid off 1,000 employees in India as part of a cost rationalisation programme. The consumer electronics major has lately had to slash prices of its smatphones and television sets amid stiff competition from Chinese rivals in India.

According to a report by the Economic Times, Samsung has 20,000 employees in India and several under-performers and those not delivering targeted results in their teams had been asked to leave. The ET report said manpower rationalisation exercise would encompass sales, marketing, R&D and manufacturing, as well as support functions like finance, human resources and corporate relations. The job cuts, accroding to the report was endorsed by Samsung’s headquarters in Seoul, with the focus now more on generating profit growth — rather than revenue — from India.

Samsung India, however, refuted the report. A company spokesperson said: “Samsung is committed to India and continues to invest significantly across its businesses. We have demonstrated our commitment by building the world's largest mobile factory in Noida, investing in local research & development and we are exploring new businesses such as 5G network, among others. In the past year, we have generated 2,000 new jobs at Samsung."

"Samsung India’s business continues to grow and expand, hence we will hire more talent across businesses through the year. As we contribute to job creation, we continuously realign resources as per business priorities to make our business more robust and efficient for long term success. As regards to business, with new products across categories, we have been able to consolidate our market share further, and we are confident of another record year,” the spokesperson added.

In 2018, worldwide shipments of smartphones declined 4.1 per cent to 1.4 billion units, according to market information provider IDC. Shipments by Samsung dropped 8 per cent  to 292 million units, although the company remained the largest smartphone vendor in the world.

 Samsung India, is going full throttle to overtake market leader (by volume) Xiaomi in the smartphones segment, and has charted a new growth strategy for the purpose. It has even  dropped prices for smartphones and televisions by 25-40% since end-2017 to compete with price-aggressive Chinese rivals like Xiaomi, OnePlus, Vivo, TCL and Realme. 

The plan, encompassing online presence, product features and positioning, has been chalked out in line with the overarching guidelines from its global management.

The new strategy by Samsung, adopted two months ago, aims to revamp presence in e-commerce channels that generate over 35 per cent of sales in the industry. To boost sales in the channel, where Samsung trailed Xiaomi for years now, the Korean major has introduced an all new online-only M series of smartphones. As a result, analyst firm IDC noted, Samsung’s share improved to 13.5 per cent in the January-March quarter. However, Xiaomi continued to lead with 48.6 per cent share.

To counter Xiaomi’s ever-growing clout in the entry and mid-segment, Samsung has placed its Galaxy A series at the forefront. The revamped A series, unlike its previous avatar, now covers a wide price range – from below Rs 6,000 to Rs 28,000. What has also changed is Samsung’s approach towards the price segment. In line with the vision of DJ Koh, its global president for information technology and mobile communications division, the local unit is now focusing on bringing in innovations in the mid-segment – unlike its earlier approach of introducing them at the top of the pyramid.

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