Halt and Catch Fire

In a rush to beat out the latest iPhone, Samsung rolled out its Galaxy Note7 with one minor flaw: The battery. I’d hate to be the engineer who had to explain that one to company vice chairman and heir apparent Lee Jae-yong: “You see, sir, well, it’s the battery. No big deal. It just, on occasion, catches fire. I mean, it’s not like our exploding washing machines!” Without panicking, Samsung then issued replacements for those potentially flammable phones. But those replacements also had the same problem—the problem of burning away in your handbag (or God forbid in your pants). Now it’s time to panic.

“We are working with relevant regulatory bodies to investigate the recently reported cases involving the Galaxy Note7,” reads the official statement. “Because consumers’ safety remains our top priority, Samsung will ask all carrier and retail partners globally to stop sales and exchanges of the Galaxy Note7 while the investigation is taking place.”


That investigation will center around the battery—but it’s not a matter of simply replacing it. As Hayley Tsukayama explained in the Washington Post, the components come from different manufacturers:

Samsung, the largest battery-maker in the world, last year bought smartphone batteries from its own Samsung SDI division as well as from Maxwell, Amperex Technology Limited, Panasonic and Lishen, according to Avicenne Energy, a consulting firm. But Samsung was unusually dependent on Samsung SDI for about 75 percent of its batteries. By contrast, Apple has bought iPhone batteries from five companies, none of which supply more than a third of its batteries. That enables Apple to nimbly switch manufacturers if a problem surfaces.

So there’s not much else the company could do at this point, what with the stock diving—just yesterday shares dropped 17.5 percent, erasing $17 billion of Samsung’s worth. Image-wise, the GalaxyNote7 is becoming the Pinto of our time.

As Ben Wojdyla recalled in Popular Mechanics:

The genesis of the Ford Pinto came sometime in 1968, when Ford’s then-president Lee Iaccoca decided that his company would not sit idly by as new Japanese competitors dominated the small-car segment. He pushed the board to greenlight the Pinto program, and by August 1968 the program was underway. It would have aggressive targets: no more than 2000 pounds, not a penny over $2000 and a delivery deadline of just 25 months, a record at the time and still impressive today. Everything was going well until, deep into the development cycle, a problem was discovered in the fuel tank design. In low-speed rear-end crash testing, the fuel tank, positioned behind the rear axle and in front of the rear bumper, exhibited several flaws. Upon impact, the filler neck would tear away from the sheet-metal tank and spill fuel beneath the car. The tank was also easily punctured by bolts protruding from the differential and nearby brackets. One report later described the entire contents of a tank leaking out in less than a minute after an accident.

We know the rest—and how the problem was magnified by popular culture. (Remember this scene from Top Secret?) Samsung has entered its rough patch—and just as the 48-year-old Lee Jae-yong takes the reins. Apple will go after these customers who (ahem) got burned. And so will Google with its new Pixel. On the bright side, at least the Galaxy Note7 wasn’t outright killing people whenever they answered it.

Related Content