LG now lets ODMs make midrange models in addition to cheap phones

In addition to its low-end phones, the South Korean manufacturer LG will now also have mid-range smartphones developed by ODMs, original design manufacturers. LG’s own people will only focus on expensive smartphones in the future.

LG K52, made by Huaqin

The step to have more models made by ODM should reduce costs, reports Reuters news agency. In that message, LG confirms what The Elec already wrote on Monday morning, namely that many of the people in teams to develop cheaper smartphones have now moved to other teams. According to The Elec, the parts MC Advanced Research, MC Quality Engineering and MC Advanced Sales have disappeared. The MC in it stands for Mobile Communications, the branch of LG that focuses on smartphones.

It is unknown which phone series LG will make itself and which will transfer to ODMs. Previously, ODMs only made the cheapest phones from the manufacturer, but next year an estimated 70 percent of all LG phones will be made by another company.

Odms are emerging on the mobile market and telephone makers take the production and often also the design and concept development of smartphones off their hands. Companies such as Huaqin, Wingtech and Longcheer are responsible for the development and production of an estimated 37 percent of the delivered smartphones in the first half of 2020. Companies are hiring ODMs because they can produce phones more cheaply and therefore have more margin. LG’s mobile division has been at a loss for more than five years in a row.