‘Did you know in advance?’ LG second-hand phone market price has already fallen

Input 2021.01.23 06:00

Clear price decline before announcement on the 20th

LG Electronics’ second-hand phone prices hit a direct hit with the prospect of LG Electronics’ withdrawal of the smartphone business. This is because if LG Electronics exits or sells its smartphone business, some changes in the post-support policy may occur. As the proportion of handset distribution also affects the market price of used phones, it is predicted that the market price may drop further than now if the business withdrawal begins in earnest. In the case of the LG Wing, which was introduced at the end of 2020, the used price has been reduced by more than 200,000 won from 700,000 won to 500,000 won in the last month.

According to the mobile industry on the 22nd, LG Electronics will reduce or sell its smartphone business, which has been in the red every year since 2015. The acquisition target companies include Google and Facebook in the US, Bean Smart in Vietnam (a subsidiary of Bean Group), and Volkswagen in Germany. It even tells us that negotiations are already underway.

On the 20th, LG Electronics President Kwon Bong-seok sent an e-mail to a member of the company’s MC division in charge of the smartphone business, saying, “We will keep all possibilities open and review the business direction.” This is a statement that formalized the prospect of LG Electronics’ withdrawal of the smartphone business, which has been controversial since the new year.

When LG Electronics reviewed the withdrawal of the smartphone business, the reaction of LG smartphone owners was negative. In the mobile community, it is predicted that if the MC business is sold, post support such as operating system (OS) updates may not be properly provided. In the mobile phone industry, there is a strong outlook that even if LG Electronics sells its MC business, there will be no problems in the after-sales service (A/S) right away, but it is not clearing consumer concerns.

The market price of used LG phones is also affected. As a result of checking used phone trading sites such as Setizon and Pongabi by IT Chosun, the used trading price of LG Electronics’ major smartphones was markedly lowered around the end of the year, when the prospect of LG Electronics’ withdrawal of smartphone business began to turn.

For example, the LG Wing (factory price: 1098,000 won), introduced by LG Electronics in October last year, belongs to the latest product in the premium model group, but after showing a market price of 700,000 won last year, the price fell to 500,000 won in January at the end of the year. It means that the middle and high prices have dropped significantly in a month.

The V50s ThinQ (factory price: 99,990 won), which was released in October 2019, also fell slowly after its launch, but the decline has grown markedly from the end of the year after November. Used prices, which had been in the mid-range of 300,000 won until recently, fell by more than 100,000 won to the early half of 200,000 won in January.

The used phone industry predicted that if LG Electronics officially reduced the smartphone business or sold it, the distribution volume could decrease and the used price could fall further.

An official in the used phone industry said, “Since the demand for used phones of LG Electronics is less than that of Samsung Electronics or Apple’s smartphones, the market price for used phones tends to be low.” “If the withdrawal of the product, the distribution volume can be further reduced and the price range can also be lowered,” he said.

LG Electronics suffered an operating loss for 23 consecutive quarters since the second quarter of 2015. The accumulated operating deficit by the end of last year amounted to 5 trillion won. In the past 2000s, the MC division accounted for more than half of the company’s total sales, which led to success. In the end, it is judged that the possibility of the recovery of the smartphone business is small from a long-term perspective, and it is evaluated that it has made a decision to review sales.

Reporter Kim Pyeong-hwa [email protected]

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