The world’s largest smartphone maker Samsung Electronics Co. has suspended sales of Galaxy Note 7, having discovered faults in lithium-ion battery cell in 24 units out of 1 million sold, and offered to exchange all phones for entirely new ones in a rare recall on the much-hyped phablet equipped with iris scanning and other innovative features.

“We sincerely apologize for the inconvenience caused to our customers. We will change the phones regardless of the purchase date,” said Koh Dong-jin, president of the mobile communications business of Samsung Electronics in a press conference Friday.

Early investigation discovered fault with battery cell. Although it needs to further explore into the matter, the maker decided to act fast upon consumer safety concern.

He said it would take about two weeks to fully meet the recall demand. Samsung Electronics is estimated to have sold about 1.4 million units in Galaxy Note 7 around the world so far - 400,000 in Korea and 500,000 in North American region alone since its release on August 19. The company shipped out 2.5 million units. If all phones are exchanged, it would cost the company up to $2.2 billion. The company also offered to make refunds according to legal policy. Shipments had been delayed to other regions due to overwhelming pre-orders. Specific recall plan by nation and region will be announced later.

Former release in Europe was pushed back until the company re-examines batteries. The shipment to the mobile carriers in Australia and the United States was also put to a temporary halt. The third-quarter earnings would naturally be hurt by the recall cost and shipment delay.

It is the first time for Samsung Electronics to have a mass-scale recalls of its smartphones. Its Galaxy S4 model also had a problem with battery explosion but recall at the time was limited.

Over the last few days, users of the phablet began to post online tales and photos of the phone exploding while charging.

By Lee Gyung-jin

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]