After several Samsung Galaxy Note 7 spontaneously exploded in August, Samsung went into overdrive. Resources were directed towards diagnosing and fixing the problem. Samsung halted sales, recalled the smartphones and attempted to fix the problem. Unfortunately, even the replacements caught fire or exploded.
Over thirty of the original device exploded or caught fire when in use. Samsung was left with no other choice but to cease production of Galaxy Note 7 entirely. The company’s shares fell more than 7%. This recorded the biggest daily drop since 2008. The research firm, Strategy Analytics, reported that Samsung would lose over $10 billion because of the smartphone.
In Europe, the company sold over 45,000 Note 7 devices as a result of the pre-order campaign launched by the company. Over 75% of this number was replaced with either a better Note 7 or a totally different Samsung handset. The producers announced that they are working with the necessary regulatory bodies to investigate the situation because customer safety remains their No. 1 priority. After Samsung announced that it had completely overcome the problem in September, it had to announce again that the replacement phones were not safe as well.
While Samsung was still busy trying to figure out the real cause of the Galaxy Note 7 explosion, a new defect was discovered in the smartphone. Although the company did not say what exactly the new problem was, it urged all users in possession of the Galaxy Note 7 or the replacement to switch off their devices. All devices should be powered down, and users should take full advantage of all the remedies made available by the company. The US and South Korean authorities have made diligent efforts to echo the warning. The latest product defect is most likely to pose even more crisis for Samsung.
As Samsung battles with its share decline and struggles to restore its reputation, its No. 1 rival, Apple, continues to experience a massive stock surge. Samsung had over 11 billion of its market value wiped off after it recalled and stopped producing Galaxy Note 7. During a statement, the firm’s representative said; “We can confirm to the public that we have permanently stopped the production and distribution of Galaxy Note7.”
Samsung is most likely to lose a significant number of customers as high-end users of smartphones are opting for Apple and Google handsets instead. Although Samsung has lost a significant amount of money following the decline in shares, the brand can still maintain its reputation to a certain extent. Users were given between 14 to 30 days to return the phone, and if the product was indeed faulty, users could receive a full refund.
Individuals from around the world were pleased with how Samsung carried out a recall swiftly and stopped production when it became apparent that the phone was not safe to use. However, the fact remains that the defective devices shipped by the Korean company could trigger a loss of faith in all Samsung products.
