Due to slowing growth and low consumer demand, Samsung Electronics is laying off over 200 executives in India. Its Chennai factory strike, amid ongoing restructuring efforts, further impacts production.
Samsung Electronics is set to let go over 200 executives from its Indian operations across various departments, according to a report by the Economic Times. This decision comes as the company’s growth in the Indian market slows, primarily due to reduced consumer demand affecting its sales.
The layoffs are expected to affect around 9-10% of the company’s total managerial staff in India. It will impact several areas, including mobile phones, consumer electronics, home appliances, and support functions.
As stated by the report, affected employees will receive three months of salary as stipulated in their employment contracts, along with a severance package equating to one month’s pay for every year of service.
Additionally, the CEO of a competing home appliance company mentioned that they have been receiving numerous urgent job applications and resumes from Samsung India executives, including senior staff, who are willing to accept lower salaries to secure new positions.
Meanwhile, Samsung’s Chennai factory workers have been on an indefinite strike since last week, disrupting the production of televisions, refrigerators, and washing machines just before the festive season. On Monday, the police had detained over 100 protesting workers and union leaders.
According to Reuters, the company is struggling to maintain operations at 50-80% of its usual capacity.
However, in light of these challenges, Samsung is considering a significant restructuring of its operations. This could involve merging some business divisions, such as those for television and home appliances, potentially leading to additional layoffs.
Furthermore, the company aims to streamline management, reduce overheads, and eliminate inefficiencies, with final decisions expected to be made after the Diwali festival.
