South Korean smartphone component makers Ryuk-Il C&S and Cammsys have entered the supply chain of Vietnamese handset maker VinSmart, TheElec confirmed on Thursday.
Cover glass maker Ryuk-Il and camera module maker Cammsys have already begun production of the some of the components it plans to supply to VinSmart, people familiar with the matter said.
Ryuk-Il has previously supplied its cover glasses, both flat and curved, to LG Electronics for the company’s G and V series of smartphones. It will be supplying back cover glasses through its Vietnamese factory to VinSmart.
Cammsys will also produce its camera modules at its factory in Vietnam to supply to its new client. The company has previously supplied the quad-camera module used in Samsung Galaxy A series.
VinSmart is an affiliate of VinGroup, Vietnam’s largest conglomerate. The smartphone maker has used Chinese original design manufacturers for smartphones since 2018.
It has hired ex-Samsung and LG employees and is planning to launch its own smartphones this year.
V640 smartphone will be the first among its self-produced model and will launch in the third quarter at the earliest and fourth quarter at the latest.
VinSmart was also in preparation to launch the V740 and its derivative model the V741. These models will began production in the fourth quarter. The company was planning to produce between 150,000 to 250,000 units per model.
VinSmart will produce over a million units of smartphones that it produced on its own by the end of the year, if these goals are met.
These models will cost between US$100 to US$150. They will be competing with Samsung’s Galaxy M series.
South Korean suppliers are keen to supply to VinSmart due to its growth potential and the influence of VinGroup within Vietnam. VinGroup has multiple businesses that these suppliers can expand to through its supply deal with VinSmart.
VinSmart was contacting more South Korean component makers. One of these suppliers was reviewing the profitability and sustainability of making a deal with the Southeast Asian company, people familiar with the matter said.
There are some who see little growth potential in VinSmart, they said. VinSmart initially planned to launch V640 in the first half of 2020 but this was delayed due to the COVID-19 pandemic. The company could have reacted better to the outbreak but lacked manufacturing experience, the people said.
According to Korea Trade-Investment Promotion Agency, VinSmart’s production site at Hanoi can be expanded to produce up to 125 million smartphones a year. Last year, 16.4 million units of smartphone were shipped in Vietnam, with VinSmart account for a million units of these (market share of 6.4%), according to research firm IDC.