Alexa

Handset production in India will surpass 100 million units in the next four years

Handset production in India will surpass 100 million units in the next four years

Red-hot India will be churning out more than 100 million units of mobile phones by 2011, a market intelligence company said in its latest report.
According to Gartner Inc., cell phone production in India, one of Asia's growth engines, is projected to soar from 31 million units in 2006 at a compound annual growth rate of 28.3 percent to reach a whopping 107 million units in 2011.
Mobile phone production revenue is also predicted to climb to US$13.6 billion by 2011 from US$4.9 billion in 2006, for a compound annual growth rate of 26.6 percent. The growth in production will be driven mainly by the expanding mobile subscriber base in India and favorable local government policies promoting local electronics manufacturing in India, Gartner said.
Currently, mobile phone production in India is dominated by the top five global handset vendors namely Nokia, Motorola, Samsung, Sony Ericsson and LG. "There are very few local-brand mobile phone makers with low production volumes and are typically focused on low-end and mid-range handsets," said the industry tracker.
"However, Gartner expects new players -- local as well as global -- to enter the mobile phone manufacturing market in India, aided by the global electronics manufacturing services (EMS) providers present in India."
Ganesh Ramamoorthy, a principal research analyst at Gartner said, existing global handset vendors as well as new entrants will outsource their production to EMS vendors to reduce "time to market" and achieve faster penetration for their own branded handsets.
"This will raise EMS vendors' share of total mobile phone production in India to nearly 40 percent by 2011," Ramamoorthy said.
As of now, domestic mobile phone production caters mainly to local demand. Over the next five years however Gartner said it expects as much as 30 percent of production to be exported to neighboring regions that are also demanding low-cost handsets such as Africa, the Middle East and other parts of South Asia.
India faces a key challenge since it lacks a mature component supply base to support local mobile phone manufacturing, Ramamoorthy said.
"India's production of vital components for mobile phones is very limited because much of it is imported," he said.
"This may not be viable in the long term, especially with demand for handsets expected to grow rapidly. Therefore, establishing a reliable component supply base will be vital for the Indian handset manufacturing industry to stay competitive in both the domestic market and the export market."


Updated : 2021-02-27 15:22 GMT+08:00