In 2014, Vietnam accepted defeat when Vietnamese businesses could not meet the electronic components for phone production offered by Samsung Group. Over time, Vietnam has demonstrated its ability to rise up the supply chain, becoming an important manufacturing hub in the tech industry.
According to the Vietnam Import-Export Report 2021, in 2021, the number of domestically produced phones will reach 233.7 million units, up 7.6%, the production value of phone components will reach VND 580.8 trillion, up 29.5% over the same period in 2020.
Although Ho Chi Minh City and surrounding areas have experienced a stressful Covid-19 epidemic in 2021, the technology supply chain in the North is not much affected. Electronics exports hit a record $108 billion in 2021, equivalent to 32% of total exports.
Electronics exports contribute the most to Vietnam’s total exports. Source: HSBC
Much of the success of the tech industry is due to Samsung’s years of foreign direct investment (FDI), according to an HSBC report. Over the past two decades, Samsung Group has poured about 18 billion USD into Vietnam. Currently, Samsung has six factories and one research and development (R&D) center, including two phone factories in the North that supply half of Samsung’s phone production.
In 2021, Samsung Vietnam recorded a 14% increase in revenue, mainly thanks to a 4-fold increase in sales of folding smartphones.
Thanks to that, Vietnam’s smartphone market share globally has increased significantly. Although more than 50% of the world’s smartphones are manufactured in China, Vietnam has won 13% of the market share, quickly rising to the position of the 2nd largest smartphone exporter in the world.
Vietnam ranks second in the world in terms of smartphone exports, just behind China. Source: HSBC
In 2021, Vietnam’s export of CBU mobile phones reached a turnover of over 33.1 billion USD, up 14.9% compared to 2020, accounting for 57.6% of the export turnover of the commodity group. Export of phone components and accessories reached over 24.4 billion USD, up 9.1% compared to 2020, accounting for 42.4%.
However, exporting phones and components faces some difficulties due to supply chain problems. The negative impact of the epidemic led to a global shortage of semiconductor chips. This has affected the production of phones in general and products using chips in particular.