Xiaomi’s goal of leading the Indian smartphone industry is intrinsically tied to the ‘Make in India’ initiative; the Chinese company has not only invested in Indian startups, but it’s also focused on localizing manufacturing and scaling without letting costs spiral.
Today the company has announced a big step in this direction; Xiaomi India is opening three new smartphone manufacturing plants in India as well its first SMT (Surface Mount Technology) plant for manufacturing PCBA (Printed Circuit Board Assembly) units.
This is expected to give major push to Xiaomi’s efforts to cope with the increasing demand for its phones in India, especially in the light of the weekly volume getting sold out in minutes.
At its first Supplier Investment Summit in India, the company announced its expansion plans in India, revealing a number of new projects and future investment plans from its global suppliers in the company’s operations in India.
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The first major news announced by Xiaomi was the establishment of three new smartphone production plants in India located across Andhra Pradesh and Tamil Nadu, all of which have been built in partnership with Foxconn.
Xiaomi’s VP Manu Kumar revealed that Xiaomi’s manufacturing plants have significantly boosted the company’s production capabilities, allowing it to manufacture smartphones at a pace of more than 2 units per second, and also mentioned that the factories employ over 10,000 people with more than 95% of the workforce being women.
“In 2015 we extended our long-term commitment to the Indian market by joining the ‘Make in India’ programme. Today we are deepening this commitment with three more smartphone factories and our first SMT plant dedicated towards local manufacturing of PCBA units”, he added.
Aside from smartphone manufacturing plants, Xiaomi has also announced the establishment of a PCBA manufacturing plant in India, which might help in bringing down production costs as PCBA constitutes 50% of a smartphone’s component value, and if they are manufactured locally, high import duties would not be levied on them.
Xiaomi plans to localize the entire PCB production of all Xiaomi smartphones sold in India by Q3 this year, a move that might also lead to a reduction in smartphone price for the customers too.
Lastly, the company also invited 50 of its global suppliers to the event and announced that if they invest in India, it might result in the single biggest investment in the country’s electronics manufacturing industry, amounting to a staggering Rs. 15,000 crore infusion.
