If smartphone and TV profits dwindle, Samsung could turn to making car components


Samsung is currently doing pretty well when it comes to smartphone and TV sales, but, with the constant pressure exerted by other top (and rising) companies, there's no guarantee that things will remain like this for a long time.

According to an article from The Korea Times, Samsung is well aware of the uncertainty that the future can bring, and is getting ready for an eventual "post-smartphone age." Reportedly, a Samsung official recently declared that "there's a point when returns [in the smartphone and TV businesses] will slow and there's no visible way to change that." The Samsung official further mentioned that the company itself needed change, as its "conventional business models" are "increasingly being challenged."

The change that Samsung is eyeing may come from the automotive industry. Rumors have it that Samsung is currently in talks to acquire Magneti Marelli, a car component maker owned by Fiat Chrysler Automobiles, for around $3 billion. 

Entering  the auto parts business would allow Samsung to diversify its sources of income, and, more importantly, to keep pace with other tech giants - like Google (which builds self-driving cars) and Apple (which seemingly plans to launch its own car by 2020). Samsung is already a vastly experienced maker of flash memory, displays, chipsets and other sensors, and its know-how should be an asset in the automotive industry. For now, however, the company isn't confirming plans to buy Magneti Marelli, or any other car component maker.

Interestingly, Samsung Vice Chairman Lee Jae-yong is in the board of directors of Exor, Fiat Chrysler Automobiles' holding company, so he has strong ties with the automotive industry. It's said that Lee Jae-yong recently discussed "several issues" with people in charge of the Fiat group, and that he's routinely exchanging opinions with leaders of BMW, Ford, or Toyota.

Another interesting fact: Samsung has a 19.9% stake in Renault Samsung Motors, a South Korean car vendor. However, RSM is merely re-branding and slightly modifying cars built by Renault (or Nissan, in the past), so it's not really a car maker.

Even if Samsung buys Magneti Marelli, we'll likely not see Samsung cars roaming around anytime soon. It looks like the company simply wants to be at the core of making cars, which is different from entirely developing and selling them. 

P.S.: pictured above is a Renault Samsung Motors SM5 (based on a Renault Laguna).

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30 Comments

1. catze86

Posts: 731; Member since: Dec 07, 2015

Samsung can make cars. Not car components. They even can make Private Jets just like Honda if they want to.

2. Florin.T

Posts: 318; Member since: Dec 16, 2013

"If they want to", yes. But it looks like they don't want to make cars, probably because it wouldn't be profitable.

7. catze86

Posts: 731; Member since: Dec 07, 2015

No, they are wrong. All they have to do is how to make those consumers smile, not annoyed by their products. And learn how to kick competitors asses just like Honda did to Harley and Toyota.

10. androidwindows

Posts: 216; Member since: Oct 04, 2014

Easier said than done.

25. razmahtaz001

Posts: 501; Member since: May 11, 2013

ofcourse samsung can...and i bet that samsung can do more of anything than apple LOL

12. Djz89

Posts: 447; Member since: Aug 25, 2014

Well, Honda isn't doing so great in the car business I guess. They just closed down in Norway, only way to get a Honda here now is through 3party solutions.

20. razmahtaz001

Posts: 501; Member since: May 11, 2013

well, hondaa may not being doing well where u came from, but where im at, hondas and toyotas rule the roads here LOL

30. Djz89

Posts: 447; Member since: Aug 25, 2014

Toyota and VW here. But tbh I like hoda more than both of them

26. MrElectrifyer

Posts: 3960; Member since: Oct 21, 2014

Florin T, you clearly don't have a clue of everything Samsung already does. Here's a good place for you to start:https://youtu.be/6Afpey7Eldo FYI, they already build cars, since 1994:https://goo.gl/fMrx8k

27. Florin.T

Posts: 318; Member since: Dec 16, 2013

@MrElectrifyer: You clearly haven't fully read the article, where I mentioned about Renault Samsung Motors. Samsung itself never made cars from scratch - they were built on Nissan or Renault architectures. It seems that it's not me the one who doesn't have a clue. Have a great, knowledgeable day!

16. zeeBomb

Posts: 2318; Member since: Aug 14, 2014

I mean, Samsung can do anything. They did start as a general produce store in the 1930s. And look at them now.

3. Plasticsh1t

Posts: 3109; Member since: Sep 01, 2014

It will lag.

5. maherk

Posts: 7007; Member since: Feb 10, 2012

Still, it won't be as laggy as your brain

15. Plasticsh1t

Posts: 3109; Member since: Sep 01, 2014

Find yourself a corner and cry to sleep.

21. razmahtaz001

Posts: 501; Member since: May 11, 2013

u need a time out bro LOL

13. cheee

Posts: 50; Member since: Jul 11, 2016

apple will make bend car

19. DoggyDangerous

Posts: 1028; Member since: Aug 28, 2015

Bendable cars might have a good future though.

6. nctx77

Posts: 2540; Member since: Sep 03, 2013

But when Apple was rumored to be doing something with a car, all these questions came out and are still coming out about why?

23. razmahtaz001

Posts: 501; Member since: May 11, 2013

does apple build/manufacture the kind of shetz that samsunng make?

8. zex999

Posts: 92; Member since: Feb 14, 2016

It would be awesome if they got more into robotics. That is the future in my opinion. Industrial and consumer robots. They can make it mainstream with a good product. Right now their robot vacuums aren't that good even, but with proper R&D I can see it happening. Something like a Boston Dynamics type robot that can help elderly and around the house would be neat to see.

14. Djz89

Posts: 447; Member since: Aug 25, 2014

Tbh, if I where to buy a car with hi-tech and high quality electronics, I would steer clear of Samsung, especially when bose and HC is a big player. They might do well in budget cars tho. Samsung IMO does not represent premium. But bang for bucks, maybe

22. razmahtaz001

Posts: 501; Member since: May 11, 2013

give me some of whatever ur smoking

29. Djz89

Posts: 447; Member since: Aug 25, 2014

It's gonna cost ya. ;)

17. Derekjeter

Posts: 1552; Member since: Oct 27, 2011

You will see that all phone makers wil suffer. Even Apple will suffer this year. I am a Apple fan and I'm not buying the new iPhone this year. There's nothing worth buying now a days. My Nexus 6p works as good as all the Androids out now and will work as good as anything coming out next year. Same goes for my iPhone 6s Plus. Now that I'm jailbroken on 9.3.3 I have made so many changes to the phone that I don't need to update to iOS 10 or go out and buy iPhone 7. Save your money and wait another year. It's not worth it. This is coming from someone who has had a new android every 6 months and new iPhone every year since the 4. Don't upgrade or buy. Keep your money.

18. Totse2k15

Posts: 479; Member since: Feb 11, 2014

Keep the car. I'd rather have her.

24. razmahtaz001

Posts: 501; Member since: May 11, 2013

thats why i like samsung...they are all about diversity.

28. pyrefox

Posts: 2; Member since: Jul 14, 2016

They'd been in car business (manufacturing) long time ago with rennault as partner. Samsung is a big company in Sokor. They have business interest such retail with tesco, heavy industries, ship building, insurance, electronics and more...

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