With United Kingdom’s departure from the European Union, various companies are expecting its operations to be affected. The UK decided to exit the European Union after 51.9% of voters were in favor of Brexit. According to the source, Brexit will majorly affect Samsung’s and LG’s electronics business.
Despite the fact that these two Korean giants don’t have any production facilities in the UK, sales in Europe have been steadily declining over the past few years, and Brexit is expected to contribute further to the decline. Samsung has plants in Poland, Slovakia, and Hungary. Due to this current situation, Korean company’s products made in Europe could be subject to tariffs when entering the UK market.
UK’s decisive vote in favor of departing from the European Union made Samsung consider the possibility of relocating its London headquarters to somewhere in EU, leaving the UK altogether. Samsung once enjoyed 21% of all mobile sales from Europe back in 2013, but that number has declined to 12.8% over a 3-year period. Earlier, Samsung also shut down its camera and camcorder business in the UK, and the company also decided not to release the Galaxy Note 5 in Europe, due to lack of desire for the smartphone.
As an independent country, the UK will likely raise prices on foreign products in order to encourage local businesses and industries. Hence, the Korean manufacturer Samsung and it’s fellow rival LG will take a hit when it comes to pricing. Acer, too, is expecting its operations to be affected by Brexit.
Well, we just have to wait and see how things work out for these companies. And as of now, the European law still applies in the United Kingdom, and the referendum will have to be ratified by the parliament. Also, it will take up to two years for the economic situation to get stable. Hence, these companies have plenty of time to decide on what to do and how to take this forward, once it all settles in.
Meanwhile, Samsung is gearing for the launch of its new phablet the Galaxy Note 7, which is reportedly launching on 2nd August. According to the reports, the company is all set to start production from July, and we hope the current scenario does not affect the company’s plans for the future ahead.