"Samsung India Electronics Pvt. Ltd. to Lay Off Large-Scale Executives Due to Rising Semiconductor Prices and Weak Consumption"... Local Media Reports

[New Delhi (India) = Correspondent Pragya Awasati] Samsung India Electronics Pvt. Ltd. has begun workforce reductions centered on its TV and home appliance businesses due to the impact of rising costs, sluggish consumer spending, and organizational restructuring. According to the Indian business newspaper Economic Times, Samsung recently requested the resignation of approximately 80 to 100 employees, including executives. This downsizing is being carried out sequentially, targeting various ranks ranging from headquarters directors and team leaders to branch and regional managers. It is reported that Samsung India Electronics Pvt. Ltd. faced increased cost burdens as memory semiconductor prices more than doubled, coupled with a weak Indian rupee and rising raw material costs, while smartphone sales in the Indian market fell by 11–12% year-on-year. Although the layoffs are currently concentrated in the TV and home appliance sectors, the industry estimates that up to 25% of the sales and marketing workforce in the electronics business could be affected.
According to local media reports on the 8th, Samsung’s domestic electronics sales organization in India is said to consist of approximately 550 to 600 executives and managers, excluding the smartphone sales team. It is reported that Samsung India Electronics Pvt. Ltd. has been sending resignation notices in small groups over the past few days. Some employees are said to have been asked to leave the company before the notice period is over. The company reportedly proposed a severance package to retirees that includes three months' salary plus an additional one month's salary for every year of service.
Samsung’s core smartphone division has been initially excluded from the layoffs. This is because the company views smartphones as a de facto core revenue source, as its mobile business in India accounts for approximately three-quarters of its sales. In particular, the company is pinning its hopes on a recovery in consumer spending ahead of Diwali, India’s biggest holiday, and premium products such as the Samsung Galaxy Z Fold and Samsung Galaxy Z Flip series are also receiving a relatively positive response.
However, the smartphone business is also in a precarious situation. According to data from Counterpoint Research, Samsung's market share ranking in the Indian smartphone market dropped from second to third place during the April-June period this year. Analysts suggest that despite the strong performance of models like the Samsung Galaxy Z Fold and Samsung Galaxy Z Flip series, the high-end smartphone market (priced at over 100,000 rupees) accounts for only about 4% of total sales, limiting its ability to offset the overall market slump. Price hikes are also increasing the burden on consumers. Samsung is reported to have raised the prices of some smartphone models by 5 to 10 percent. The National Association of Mobile Retailers in India stated that customer store visits have plummeted by approximately 40% due to successive price increases.
The home appliance business is also acting as a burden for Samsung India Electronics Pvt. Ltd. Home appliances is the second-largest business segment, accounting for approximately 11% of Samsung India Electronics Pvt. Ltd.'s revenue. In particular, it is reported that although Samsung pursued an aggressive expansion strategy in the air conditioner market this year, it failed to sufficiently broaden its presence in the high-end product market. With rising raw material prices compounding the situation, improving profitability remains difficult.
Samsung is reportedly pursuing a physical reorganization of its structure in India. Work is underway to consolidate offices in locations such as Ranchi and Patna, Delhi and Gurgaon, and Punjab and Chandigarh by integrating various branches. Consequently, personnel with overlapping roles are being laid off. A plan to reduce management layers by consolidating the home appliance and TV sales organizations into a single entity was also pursued, but this integration is reportedly being postponed until the upcoming December quarter.
The industry analyzes that this restructuring may not be a one-off event. Speculation suggests that further workforce efficiency improvements, centered on the TV and home appliance sectors, could occur following Diwali. However, Samsung currently has no immediate plans to reduce the workforce in its mobile business and is expected to decide on the direction of future organizational restructuring after observing sales recovery during the Diwali period.
[email protected] Correspondent Pragya Awasati Reporter