LG may shutter its mobile phone business, announcement expected in April

LG's phone business has been making losses and it may finally be time for it to be shut.

LG smartphones may soon become a thing of the past. The South Korean company is seemingly looking at shutting down its phone business after its tentative plans for sale failed to materialise. As reported by South Korea’s Donga Ilbo, citing a source familiar with the development in the electronics industry, LG Electronics discussions with two potential companies that showed interest in buying LG’s phone business fell apart. Now, LG is possibly going forward with the option of pulling the plug on its phone business, instead of searching for more candidates. According to the report, LG Electronics was talking to Germany’s Volkswagen AG and Vietnam’s Vingroup JSC for selling the phone business, which was potentially one of the options that LG Electronics CEO Kwon Bong-seok suggested back in January. He said that all options were on the table for the company’s loss-making phone business. In a letter to employees, Bong-seok reportedly explained the company’s intentions to quit the smartphone industry. LG has reportedly lost around $4.5 billion (roughly Rs 32,856 crore) over the past five years, which turned out to be a strong indication for LG to make a firm decision. “Since the competition in the global market for mobile devices is getting fiercer, it is about time for LG to make a cold judgment and the best choice. The company is considering all possible measures, including sale, withdrawal and downsizing of the smartphone business,” an LG official was quoted as saying in a report by The Korea Herald published in January.