According to the Korea Central Daily, Samsung Electric announced on the board of directors on December 12 that it would liquidate Kunshan, China, and officially withdraw from the smartphone mainboard (HDI) business.

It is understood that Kunshan Samsung Electric was registered and established in 2009. In June 2010, it officially launched HDI mass production and became the main production base of Samsung Electric HDI.

Since October this year, Samsung has transferred HDI equipment from the Busan plant to Vietnam. After arriving in Vietnam, it only produces after-sales related products, and gradually scales down until exit.

Some analysts believe that the reason why Samsung Electric decided to withdraw from the HDI business was because Chinese manufacturers lost their competitive advantage due to their low price strategies, and their profitability continued to decline. Kunshan Samsung Electric has sustained losses for five years, making the entire HDI business unprofitable.

LG Innotek just announced its decision to terminate HDI business last month, due to the decline in demand for high value-added products from mobile devices and intensified competition. After the withdrawal, some resources were transferred to the semiconductor business.

Samsung Electric intends to focus on semiconductor packaging substrates and hard-lead printed circuit boards (RF / PCB) after exiting HDI to improve profitability of basic business.