Samsung’s new folding smartphones are significantly cheaper in the South Korean home market than in the rest of the world. Buyers in Europe sometimes pay almost 45 percent more for the devices. The manufacturer is now justifying its pricing strategy.
Price surcharge for folding cell phones
Samsung presented its new foldables at its Galaxy Unpacked event this week and also revealed the prices. While customers in South Korea benefit from relatively low prices, buyers in Europe and the USA pay significantly more. The price difference is almost 50 percent for some models. Samsung has now revealed why that is the case and will remain that way. The standard Galaxy Z Fold 8 model is the most expensive in Europe. The device is offered in this country in its 256 GB version for 1,999 euros. On the South Korean market, however, it only costs buyers the equivalent of 1,355 euros. Customers in Germany pay around 32 percent more.
The difference is even more serious with the Z Fold 8 Ultra as the new flagship model. With 256 gigabytes of storage space, it costs 2199 euros in Europe. This means a noticeable price increase of 100 euros compared to the Z Fold 7. In South Korea, however, the same device costs buyers the equivalent of only around 1,525 euros. European users therefore pay a whopping surcharge of around 44 percent. As The Korea Times reported, Co-CEO Roh Tae-moon commented on the pricing policy on the sidelines of the event.
Accordingly, the group sees the South Korean home market as the foundation for the brand’s global competitiveness. The aim is to permanently reward the decades of support from local consumers, which made the company great, with the lowest prices.
Costs for components are rising
Increased memory prices and higher component costs are putting smartphone manufacturers worldwide under pressure. Roh explained that Samsung is trying to absorb much of the cost pressure by optimizing the supply chain and working closely with partners. However, as soon as expenditure exceeds a certain level, it is inevitable to pass on part of it to the end customers.
Historically, the company often subsidizes its devices in its home region with budgets from other business areas. South Korea served as the primary test market for the very first foldable phone a few years ago. The strategy makes it clear that Samsung is consciously accepting lower profit margins in order to receive quick feedback from a highly technology-savvy user base.
New strategy for foldables
In addition, Roh gave deeper insights into the product strategy. The current lineup of Galaxy Z Fold 8 Ultra, Galaxy Z Fold 8 and the compact Galaxy Z Flip 8 represents the final development stage of the folding smartphone category. Since the technology is now largely mature, two models are no longer sufficient to meet diverse customer needs.
With the expansion to three models in this generation, the electronics group now plans to achieve new record sales and maintain its leadership position in the global market. The growing competition from other manufacturers is welcomed as it shows that foldable devices have reached the mass market, said the Samsung boss. His company still wants to set technological standards for developers and engineers.
