LG Electronics, the multinational South Korean electronics firm, is reportedly facing immense backlash from local South Korean phone distributors over its plans to sell Apples iPhones from its stores. On Thursday, a private consensus-based committee on shared growth extended its support to the opponents, claiming that LG would be walking back on its word if it went forward with the plan.
The Korea Commission for Corporate Partnership cited LG's 2018 agreement with the committee, in which the company promised to work for co-prosperity with small companies in the sector.
According to reports, LG, which is shutting its loss-making business of smartphone manufacturing next month, is planning to sell iPhones from its offline stores for home appliances from the third quarter of this year.
However, the Korea Mobile Distributor Association, which represents the interests of local mobile phone distributors, has criticized the idea. The association has also asked the Korea Commission of Corporate Partnership to intervene in this matter through a letter.
In 2018, to avoid competing with smaller phone wholesalers, Samsung Electronics and LG Electronics had agreed to effectively limit phone sales at their stores to their own respective brands.
However, it is being stipulated that the agreement could be modified on some conditions under different situations.
An official from Korea Mobile Distributor Association satiated that the LG's exit from the smartphone market has become an unanticipated shift to contemplate. Both parties will have to work together to come up with a fresh settlement on the matter.
LG is now doing an internal assessment of the iPhone sale strategy. Meanwhile, it is rumored that Apple Korea is interested in partnering with LG in order to enhance its Korea sales. However the tech giant has not put out an official statement in this matter.
Recently, after LG announced its plans to shut down its smartphone division, Apple introduced a trade-in scheme for LG phone owners, which appeared to be a strategy focused no absorbing the disenfranchised smartphone users.
Ultimately, if both parties fail to reach a mutual decision, the commission will intervene to resolve their disputes.
Source credit: http://www.koreaherald.com/view.php?ud=20210624000733