Samsung halts Galaxy Note 7 production as smartphone crisis deepens

Samsung Electronics has suspended production of its Galaxy Note 7 smartphone following fresh claims of products catching fire.

South Korea’s Yonhap news agency said the halt “is in cooperation with consumer safety regulators from South Korea, the United States and China”.

A spokesman for the South Korean manufacturer said: “We are temporarily adjusting the Galaxy Note7 production schedule in order to take further steps to ensure quality and safety matters."

The decision follows the disastrous launch of the Galaxy Note 7 smartphone this summer.

The flagship products had to be recalled in September following reports of batteries exploding during charging.

However new claims have surfaced about similar problems with replacement devices.

Shares dropped by as much as 4% in early trading on Monday.

Samsung last week saw activist investor Elliott call for a shake-up at the business, amid a succession crisis in the founding Lee family.

Elliott wants Samsung to simplify its complicated ownership structure. It made a similar attempt last year that ended in acrimony.

This time, it has proposed the business be split into a holding vehicle and operating company.

The company’s future ownership has been under scrutiny since patriarch Lee Kun-hee, 74, was incapacitated by a heart attack in 2014. His heirs — primarily likely successor Jay Y Lee and his two sisters — have yet to publicly discuss their plans.