Samsung Electronics Co.’s pledge to recall all Galaxy Note7 phones after some of the devices caught fire has put a spotlight on what the world’s largest smartphone maker would do with the massive piles of premium phones equipped with the newest and latest technology features.
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“As a follow-up of the battery issue, we made a decision to temporally stop using Samsung SDI’s battery for Galaxy Note 7“, said a source at Samsung, according to multiple Korean publications (via The Korean Herald).
According to a report by Bloomberg, the move to replace the 2.5 million Note 7 phones that were already shipped to retail partners and customers may cost the South Korean company a staggering $1 billion (Rs 66,000 crore approximately). The move was initially deemed a success after it helped Samsung report on its best profit in more than two years, but the strains on its supply chain appear to have backfired disastrously. Samsung SDI makes batteries for the Apple iPhone, among various other brands.
In order to fill the battery losses, the company might have to turn to another provider of batteries used in its “Galaxy Note 7”. But ahead of its iPhone launch on September 7, the company has been handed a gift, which may drive more customers to buy not only the new devices, but even the current version. Samsung said it narrowed the problem to a “battery cell issue” in the device’s lithium battery. Since past year, the South Korean firm, the world’s largest maker of smartphones, has brought forward the launch of its Galaxy S and Galaxy Note series models by roughly a month.
A company statement said that Samsung is “currently conducting a thorough inspection with our suppliers to identify possible affected batteries in the market”. These will probably be the cheapest refurbished Galaxy Note 7 versions that Samsung could sell.
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More than 35 cases of the exploding battery defect have been reported since the phone, which retails for 1,035 U.S. dollars, was launched on August 19.
