Samsung Note 7 explosion in China stokes concern over new versions

A Chinese man has reported that a new Note 7 smartphone from Samsung Electronics exploded after he bought it this week, raising questions about whether the South Korean company’s problems with battery fires are spreading to newer versions of the premium device.

The company announced September 2 that it would replace all 2.5 million phones sold globally at that point. Samsung also said it had uncovered the cause of the battery fires and that it was certain new phones would not have the same flaws.

The 25-year-old customer, Hui Renjie, said his Note 7 exploded Monday morning, less than 24 hours after he got it delivered from the e-commerce website He said the incident caused minor injuries to two of his fingers and burned his Apple MacBook. A Samsung representative visited him soon afterward and asked to take away the phone, he said, but he declined the offer because he did not trust the company to reveal the reason for the fire, and plans to publicise the issue.

“We are currently contacting the customer and will conduct a thorough examination of the device in question once we receive it,” the Korean company said.

Samsung has been engulfed in perhaps the worst crisis in its corporate history after Note 7 smartphones began to burst into flames just days after hitting the market in August.

The company said on Tuesday it has recovered more than 60 per cent of all Galaxy Note 7 smartphones sold in South Korea and the United States that have been recalled.

The latest China incident, however, raises the prospect that Samsung has battery problems with Note 7 phones now hitting the market, adding the risk of further recalls and potential brand damage. Analysts have estimated that the original recall would cost the company US$1 billion to $2bn.

The sporadic reports of phones bursting into flame are unlikely to do its business any favours in China, where it is already slipped out of the top five and lost market share Huawei Technologies, Xiaomi and other manufacturers.

Local media have also criticised the Korean company’s decision to mostly exclude the world’s largest smartphone arena from its global recall, saying that Note 7s sold there used different batteries that were not prone to overheating.

“Samsung’s business in China will only get worse,” said Greg Roh, an analyst at HMC Investment Securities in Seoul. “Samsung may have to sacrifice massive marketing costs in China to win back its customers.”

The original Note 7 fires came after Samsung decided to rush the device to market to take advantage of what Korean executives thought would be a mediocre iPhone 7 from Apple. Top executives were convinced the Note would dazzle consumers and they pushed suppliers to meet unusually tight deadlines, despite loads of new features, people familiar with the matter said.

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