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How costly will the Galaxy Note 7 recall be for Samsung?

5 September, 2016 Samsung


The total expense of recalling the Galaxy Note 7 and replacing them could cost Samsung something around a billion US dollars. Keep in mind that this figure does not factor in the loss of sales which the embarrassing incident may lead to. There's also the long term effect of bad reputation, which can actually have an even worse impact on Samsung's market share than this single episode. As a result, Samsung has decided to not use a single battery from their own battery manufacturing wing, Samsung SDI, while replacing the smartphones. It is estimated that Samsung SDI supplied about 70 percent of the total batteries used in the 2.5 million Note 7 devices shipped worldwide and the faulty ones were indeed, supplied by them.


Unfortunate as the scenario might be for both the customers and the manufacturer, one cannot deny the brave and commendable decision that Samsung took in calling back the hazardous devices. Although some may see this as a blemish on the company's reputation, it can also be viewed as an honourable move, despite the huge losses the company took. This can also instil confidence in their customers that Samsung won't abandon them the moment something goes wrong.


Saikat Kar (tech-enthusiast)

 


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