It’s tough to find somebody who hasn’t heard of Samsung before. Currently, the South Korean tech giant, whose revenue was projected to have been over $300 billion in 2014, owns and operates a variety of different companies and builds a bevy of devices. Samsung is known for manufacturing televisions, home appliances, mobile devices and even military weapons. Now, Samsung is looking to enter probably the only industry it hasn’t tapped into yet: automobiles.
Recently, Samsung officially announced that it intends to purchase Harman International Industries for $8 billion. The deal is expected to close sometime next summer. While Harman is primarily known for its top-tier audio equipment, most of its revenue actually comes from its infotainment, automotive and driver-oriented technologies. By purchasing the company, Samsung seeks to get its foot in a market that is quickly growing. Samsung believes that the automotive technology market will grow over $100 billion by 2025.
The mobile device market has primarily been Samsung’s go-to for quite some time now, but given the recent embarrassment of its Galaxy Note 7 debacle, Samsung is more than likely attempting to gain traction in a new market.
In a New York Times article, Young Sohn, President and Chief Strategy Officer at Samsung Electronics, stated, “the vehicle of tomorrow will be transformed by smart technology and connectivity in the same way that feature phones have become sophisticated smart devices over the past decade.”
The acquisition stands to be extremely profitable for Samsung. Harman already has deep rooted connections in the automotive industry, including deals with Tesla and General Motors. And with more and more cars requiring processors and screens, Samsung can take advantage of its brand new contacts to learn more about selling its products to car manufacturers.
Samsung isn’t the only company trying to get into the automotive industry. Both Apple and Google have shown heavy interest in not only implementing their technology into cars (which they are already doing), but developing their own smart cars as well.
With three of the top technology companies in the world looking to blur the lines between our smart devices and our cars, it’s safe to say that the future of the automotive industry is going to be very bright.