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Samsung to adjust Note 7 production

October 10, 2016

Samsung's crisis with its Galaxy Note 7 smartphone has hit a new low as the South Korean tech giant confirmed that it had made changes to its production of the problem phones to ensure safety.

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Samsung Galaxy Note 7
Image: picture-alliance/AP Photo/A. Young-joon

In a statement and in a regulatory filing, Samsung Electronics said Monday it was "temporarily" adjusting the Galaxy Note 7 production schedule and production volume to "ensure quality and safety matters."

But Samsung fell short of confirming or denying earlier media reports that it had halted production.

The comments came after a report by Yonhap News Agency suggested that the company had suspended production of its phablet device. The South Korean agency said that even the newly released Galaxy Note 7 phones, which had been offered as replacements for the recalled fire-prone phones, also overheated or caught fire.

Citing unnamed sources at a Samsung partner firm, Yonhap said the production halt was done in cooperation with authorities in China and the United States as two US carriers had stopped exchanging or selling new Note 7 phones.

Global recall

Samsung, the world's largest smartphone maker, started selling the Galaxy Note 7 on August 19. Less than a month later, however, a global recall of some 2.5 million units was announced, following reports that some of the devices had caught fire.

The recall appeared initially to be on track until last week when reports emerged of similar problems occurring with some of the replacement phones.

US media reported on Wednesday that a Southwest Airlines flight was evacuated after an overheated Galaxy Note 7 started emitting smoke. Around 75 people, passengers and crew members, were forced to leave the Baltimore-bound plane in Louisville, Kentucky. According to local media, the phone had been replaced two weeks earlier as part of the recall process.

Samsung share price plummets

On Sunday, US telecommunications firm AT&T and German rival T-Mobile said they would suspend exchanges of recalled Galaxy Note 7s pending further investigations.

The announcement saw Samsung's share price plunge by as much as four percent in early morning trade on Monday - even before the Yonhap news report came out. It recovered later to close the day at 1.68 million won ($1,515) - down 1.52 percent from Friday's close.

AT&T said they would continue to offer customers the option to exchange Galaxy Note 7s for another Samsung smartphone or other device of their choice.

T-Mobile, however, said it was halting sales of the smartphone, as well as the exchanges.

uhe/jd (Reuters, AFP, dpa)