Tokyo earlier this month announced a restriction order on the export of three tech-related chemicals vital to South Korea’s world-leading chip and smartphone industry. The decision according to officials stems from Seoul’s failure to come up with a “satisfactory” solution to the wartime labor dispute. Samsung and LG mobile rely majorly on these supplies.
Like we reported earlier, the dispute, if not tamed, could be disastrous to not only the Korean tech industry but could also jeopardize the supply chains for many electronics products – particularly smartphones.
Seoul’s Samsung Electronics, LG, and even Apple are the worst hit as they solely rely on chemicals from Japan for a whole lot of products vital to the smartphone industry.
Well, Samsung electronics has moved to avert being enmeshed in a production crisis that could arise from a shortage of its all-important raw materials. The company’s Vice President Li Zaiyu made a trip to Tokyo earlier last week has informed management of the outcome of his trip.
The VP revealed that he has secured on behalf of Samsung emergency supplies of three key materials that Japan had cut off as part of its export restrictions. The aim is to avert a major production issue that could ensue at the South Korean company’s production lines. We are not sure how VP secured the so-called emergency supplies, or what compromises were made. But his move is one that should help prevent it from plunging into production crisis at its manufacturing plant.
Any plans for Samsung?
VP Lee also informed management of the needs to prepare a contingency plan in case the brawl between both countries is not resolved in the soonest.
We are not sure of the level of supplies of each material, however, Bloomberg reported earlier last week that Samsung has less than a month’s worth of supply on average.