Huawei to start smartphone production in Chennai

Chinese telecoms equipment maker to expand presence to over 200 cities with 20,000 outlets in three years; plans to produce smartphones for Indian market out of Chennai facility.

Chinese telecommunications equipment maker Huawei is firming up plans to manufacture smartphones for the Indian market out of its facility in Chennai, which already makes networking equipment. This will help support its plans to expand its presence to over 200 cities with 20,000 outlets in three years.

In a report by Financial Chronicle on Sunday, Huawei said that it was "currently conducting quality evaluations and sorting out supply chain issues". The firm presently makes handsets in China and oursources some production to Foxconn.

Victor Shan, president of Huawei India’s device business department, said in the article: "Low-level feature phones are preferred in rural areas while smartphones are preferred in tier I and tier II cities." He added that tier I cities accounted for 60 percent of its smartphone sales there.

Huawei--currently present in 35 Indian cities and has 2,500 outlets across the country--plans to expand its presence to over 200 cities and 20,000 outlets over the next three years, noted the Financial Chronicle.

Last month, the Chinese company had posted a 22 percent drop in its operating profit for the first half of the year at 8.79 billion yuan (US$1.4 billion). This was despite a rise in revenue of 5.1 percent to 102.7 billion yuan (US$16.07 billion). However, the company said it was relatively optimistic in its operating performance and profitability for the remainder of 2012.


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