The coronavirus rages on in South Korea, as Samsung Display rival LG Display shuts down a phone screen factory in Gumi due to coronavirus.
LG shuts down phone screen factory due to coronavirus
The factory in question was shut down because of a confirmed case of the disease at a bank right beside the factory. A bank employee has tested positive for COVID-19, leading LG to take precautions to prevent the spread of the disease to its factory workers.
Gumi factory shutdown: Deja Vu
LG’s Gumi factory for phone screens is not the first plant in Gumi, South Korea to shut down. In fact, it’s the second. The first was LG rival Samsung Electronics, who had a confirmed case in its factory in the same city one week ago. An employee at Samsung’s Gumi plant tested positive for coronavirus. Initially, Samsung said it would shut down the floor where the employee worked. Later, Samsung decided it would not shut down the factory until February 25th but, instead, would sanitize the floor and warn its employees about covering their mouths and wearing face masks. The company did shut down the factory for two days for disinfection, but that was all.
Unfortunately, Samsung has now reported a second coronavirus case in about a week. As of yesterday evening, Samsung is now confirming that a second employee tested positive for coronavirus. The Gumi plant will be shut down from March 1st through March 3rd.
The second coronavirus-positive employee works in the business division where Samsung crafts devices such as the Galaxy Z Flip and the Galaxy Fold. The assembly line the worker was on will be closed until next week. The floor he worked on will reopen after March 3rd.
A third person at Samsung’s Giheung semiconductor plant has tested positive for coronavirus, though that individual is a cafeteria partner and not a Samsung employee.
The bigger picture: coronavirus in South Korea
LG and Samsung factory shutdowns are indicative of the bigger, much more tragic, picture in South Korea. Coronavirus rages on there, as South Korea is the disease’s largest populace outside of China itself. As of today, there are 4,212 cases of coronavirus, with a new 476 cases overnight. 22 South Korean residents have died of coronavirus so far.
Despite LG’s slogan, life is not all that good for LG or South Korea at this point.
Coronavirus impact on South Korea, LG’s hometown
LG Display is LG Electronics’ display division. The subsidiary is responsible for manufacturing LG smartphone displays. While the LG Display factory is shut down, phone screens aren’t being made. The result is that phone screens could be in high demand with low quantities if coronavirus continues to rage in the city of Gumi. Samsung has had three confirmed cases in that same city. Though LG hasn’t yet reported a case of one of its employees, a bank employee who passes by the plant is enough to lead to a confirmed case later on this week, for example.
As for South Korea, it stands to lose billions of dollars behind coronavirus. With so many cases of coronavirus on the rise, it stands to reason that at some point, factory employees will encounter the disease, too. Samsung’s Gumi complex makes phones for the domestic market (South Korea). To shut down the plant indefinitely seems to be inevitable at this point. It’s really just a matter of when.
LG doesn’t have as many factories as Samsung. To shut down its Gumi factory could lead to the loss of lots of money in South Korea. Samsung and LG are the two Android OEMs that give South Korea’s economy a large boost in the mobile phone sector. Their financial losses could prove devastating for South Korea unless employees remain free of the sickness and continue to work.
LG, coronavirus, and its impact on the American market
LG Display makes phone screens for its own smartphones as well as for iPhone maker Apple. LG’s screen misfortunes result in misfortune for Apple’s iPhone display stock as well. And lack of iPhone displays will impact the American market, as Americans won’t be able to secure the iPhone(s) they want in a timely manner. Fears of contracting coronavirus through touching smartphone displays may also move some American consumers to “wait it out” another year with their current, aging iPhone. The fear behind “touching coronavirus” remains the top reason why the GSMA canceled Mobile World Congress (MWC) 2020 this year. The MWC 2020 cancellation (which LG bailed on before the cancellation due to coronavirus) is the first in MWC’s 33-year history.