China’s Huawei to assemble smartphones in India with partner Flex

Expansion follows the rush of other Chinese brands into the world’s second-biggest smartphone market

PUBLISHED : Monday, 19 September, 2016, 8:12pm
UPDATED : Monday, 19 September, 2016, 10:59pm

Huawei Technologies plans to start production of its smartphones in India by the end of September, joining the expansion of other Chinese brands in the world’s second-biggest market for the devices.

The Shenzhen-based company’s foray into the market will be in partnership with contract electronics manufacturer Flex, formerly known as Flextronics International.

Industry sources said on Monday that a formal announcement of the initiative, which was first reported by Indian media, will be made at the end of this week.

Beset by slow growth in their home market, many Chinese smartphone suppliers have ramped up their operations in India as the country’s appetite for advanced, low-cost smartphones has grown in the past few years.

Huawei, the world’s largest telecommunications equipment supplier, will have its smartphones assembled by Flex at a plant near Chennai, where the Nasdaq-listed company already manufactures smartphones for Lenovo Group, including its Motorola brand, according to Indian media.

Huawei and Flex declined to comment when contacted by the South China Morning Post.

“Huawei may begin with a [smartphone production] capacity of 200,000 units a month, but it can scale up rapidly as the plant has enough capacity to take on more orders,” a person with knowledge of the matter told both The Financial Express and Economic Times on Saturday.

The same person said the initial batch of Huawei Android smartphones to be produced in India would include its mid-range Honor 5c and premium P9 model, which has a dual rear camera co-developed with Germany’s Leica Camera.

Privately held Huawei has been the world’s third-largest smartphone supplier in the past five quarters, according to data from technology research firm IDC.

We are optimistic and confident about reaching our target shipment of 140 million smartphones this year
Richard Yu Chengdong, chief executive, Huawei’s consumer business group

However, the company has failed to crack the upper echelon of smartphone suppliers in India, where Samsung Electronics continues to lead the market.

Lenovo, along with its Motorola unit, ranked third in the Indian smartphone market in the second quarter, IDC data showed.

Indian brands Micromax, Intex and Reliance Jio were ranked second, fourth and fifth, respectively, during the same period.

Huawei’s expansion into India followed the company’s recent announcement that it would open 15,000 new retail stores around the world this year, as it aimed for a record-high global shipment of smartphones and greater sales of premium-priced models.

“We are optimistic and confident about reaching our target shipment of 140 million smartphones this year,” Richard Yu Chengdong, the chief executive of Huawei’s consumer business group, said in July.

Other Chinese smartphone brands doing business in India include Vivo, Oppo Electronics, Xiaomi, OnePlus, Gionee Communication Equipment, Hong Kong-traded Coolpad Group and Leshi Internet Information and Technology, more popularly known as LeEco.

Xiaomi was the first major Chinese smartphone brand to make a big splash in India when it entered the market in July 2014. It started local production a year later with Hong Kong-listed contract manufacturer FIH Mobile.