Samsung’s SDI battery affiliate struggling following Galaxy Note 7 debacle

Samsung’s Galaxy Note 7 woes are likely to continue for some time, after the company took a huge financial hit following the phablet’s global recall.

But it’s not just  Samsung that is feeling the pressure. When Note 7 handsets started overheating, the South Korean firm initially put the fault down to batteries made by its affiliate company Samsung SDI.

Unfortunately, once Samsung started using batteries from third-party firm ATL, the handsets continued to overheat and, in some cases, explode.

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But the damage had seemingly been done, and now, as Reuters reports, Samsung SDI is struggling to regain trust among its clients, including Apple.

The report quotes ‘a person at SDI who was involved in developing the Note 7 battery’ as saying: “Since the first recall, we’ve had many inquiries from our clients, including Apple, asking whether batteries used in their products are safe.

“We are also asking ourselves whether we should have done it (the Note 7 battery) this way, or whether there could have been other ways.”

Note 7 battery recall

Kim Hong-gyeong, SDI’s chief financial officer reassured analysts on a conference call that the company was doing all it could to improve battery reliability and customer trust.

However, some analysts say the effect of the Note 7 saga is far from over for SDI, especially when it comes to attracting new customers.

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SDI was the main supplier for Note 7 batteries, and has lost around a fifth of its market value since the overheating problem came to light. Its third-quarter operating loss also doubled compared to this time last year.

The firm incorporated ‘new materials and technology’ to meet Samsung’s need for bigger battery capacity on the ill-fated phablet, which seems as though it could have been a contributing factor to the overheating issues.

An engineer who worked on the Note 7 battery told Reuters that, when it came to the Note 7, boosting battery capacity could have led to ‘reliability’ issues.

Samsung is yet to release a full explanation of what went wrong, and is currently investigating the issue. Once an official explanation is provided, it remains to be seen whether Samsung SDI’s reputation will benefit.

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Let us know if you were affected by the Note 7’s overheating problems in the comments.

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