Samsung has permanently halted production of their fire-prone Galaxy Note 7 smartphone, in the face of safety issues concerning the batteries that power the handsets. A number of Note 7 batteries had exploded or caught fire, a number of those reportedly involving the batteries in supposedly “safe” replacement handsets offered in the original recall of the device.
Samsung had already recalled the Note 7 once last month after early models exploded and the latest move comes after customers reported that replacement phones were also catching fire. Samsung will be without its highest-end smartphone that was supposed to compete against Apple Inc.’s iPhones and other premium devices during the holiday shopping season.
A Samsung spokesperson has told TechCrunch: “We can confirm the report that Samsung has permanently discontinued the production of Galaxy Note 7.”
The South Korean company didn’t provide any additional information about its decision to halt production of the device, but in a filing about ending production with South Korean government regulators, it cited “customer safety” as the reason.
On Monday, Samsung asked carriers and resellers to halt sales and exchanges of the Note 7,. as reports of issues with replacement handsets continued to roll in. Note 7 owners will now receive a full refund, or a different Samsung smartphone, plus a $25 gift certificate or other consideration.
Samsung had “temporarily” suspended production of the handsets earlier this week, citing the new reports of fires involving replacement units.
On Wednesday of last week, a Southwest Airlines Louisville-to-Baltimore flight was evacuated before leaving the gate when a passenger’s Note 7 began smoking.
A Minnesota girl’s Note 7 caught fire on Saturday. The 13-year-old said she felt a weird, burning sensation” while holding her phone, suffering a minor thumb burn.
In another Saturday incident, a Kentucky man was diagnosed with acute bronchitis, following a trip to a local Emergency Room, after his Note 7 caught fire while he was asleep in his bed, filling his bedroom with smoke. “It wasn’t plugged in. It wasn’t anything, it was just sitting there,” said the man.
Sunday saw a report of another bedroom incident, as a Virginia-based owner of a Note 7 reported his device “just burst into flames while on the night stand.” Shawn Minter contacted The Verge after his Note 7 caught fire on his nightstand at 5:45AM. Later the same day, a Texas family reported their Note 7 had caught fire while they sat eating lunch together.
Some reports have indicated Samsung rushed the handset into production in an attempt to capitalize what company official believed would be a “boring” iPhone 7 and iPhone 7 Plus release.
While Samsung did issue a global recall for the device just before the release of the iPhone 7 lineup, the continued reports of even replacement units catching fire quickly became a public relations nightmare for the company. Some analysts had predicted the fiasco could cost Samsung USD up to $5 billion in revenues.
A complete withdrawal of the Galaxy Note 7 will be an even harder hit to the company’s finances, and even worse, could permanently damage the Galaxy brand. Reuters cites analysts estimating that a permanent end to Note 7 sales could cost the company up to $17 billion.
Bloomberg reports Samsung Electronics shares fell 8% in Seoul Tuesday, wiping out about $17 billion of market value, before the Note 7 termination was announced. The stock dropped further in London trading after the news, dropping as much as 9.5%.