Xiaomi plans to strengthen its market position in India by establishing three new smart phone manufacturing plants in the country. While the company already assembles most of its smartphones in India, these new factories are aimed at boosting the production of smart phone components, including the PCBA (Assembly of printed circuit boards). The announcement was made at an investment Summit for suppliers in New Delhi attended by dozens of suppliers of Xiaomi components to familiarize them with the opportunities for growth in the country. If all suppliers decide to participate, Xiaomi can provide an additional investment of 15,000 crore rupees ($ 2.5 billion) while creating 50,000 new jobs in India.
With these three new factories, Xiaomi will soon have a total of six smart phones manufacturing plants in India spread through three different states: Uttar Pradesh, Tamil Nadu and Andhra Pradesh. One of the company's manufacturing power banks has already started assembling smart phones, while a new PCB-dedicated manufacturing unit will be installed in Sriperumbudur, Tamil Nadu, which will be the first of its kind to use Surface Mount Technology (SMT). ). Currently, only 10 percent of the value of the smartphone is contributed by the Xiaomi assembly lines in India, which should rise to 50 percent when the new plants start operations. The company aims to achieve a 100 percent location for the third quarter of this calendar year. The three plants will be established in partnership with Foxconn, which also established Xiaomi's first three manufacturing units in India. The company says its factories currently employ about 10,000 people, 95 percent of whom are women.
These plans have been announced under the Indian government's Make in India program that intends to boost local manufacturing by offering various incentives. Xiaomi's announcement comes after the government's recent decision to impose 10 percent import duties on certain smartphone components to encourage local manufacturing. In a recent report, it was said that the Chinese brand had become the largest smartphone manufacturer in India, becoming the second most important market for the company after China. Despite its leadership position, Xiaomi still relies on instant sales, where some units of the product are made available that usually sell out in a matter of seconds, leaving many customers furious about not being able to buy one. These new plants should help improve the availability of smartphones in India to meet the country's overwhelming demand for low-cost smartphones.