Seoul: Tech giant Samsung Electronics Co. may need to overhaul its global production strategy as new U.S. reciprocal tariffs could significantly affect its smartphone business, industry sources said Sunday. Last week, U.S. President Donald Trump announced plans to impose a minimum 10 percent "baseline" tariff on all imports to the United States and country-specific "reciprocal" tariffs that include 25 percent duties for South Korea.
According to Yonhap News Agency, the reciprocal tariffs, covering most product categories except some products like vehicles, semiconductors and pharmaceuticals, are set to take effect Wednesday (U.S. time). Experts and industry analysts noted that Samsung Electronics needs to cope with the U.S. tariff policy by utilizing its policy of diversifying production bases.
Samsung Electronics, the world's largest smartphone maker, produces some half of its smartphones in Vietnam, facing a 46 percent reciprocal tariff on goods entering the U.S. The rest of its smartphone production is spread across India, Brazil, Indonesia, and South Korea. India faces a 26 percent tariff, South Korea 25 percent, and Brazil just 10 percent, making it a potentially attractive hub for serving the U.S. market.
Sources suggest Samsung Electronics may consider increasing the production in India, Brazil, and South Korea, especially for premium models intended for American consumers. Brazil, in particular, stands out due to its low tariffs and geographic proximity to the U.S., they added.
The company is expected to reassess its production policies ahead of the summer launch of its next-generation foldable smartphones, but for now, it is proceeding cautiously. "Nothing has been decided yet," said an official from Samsung Electronics.