News Make in India: Xiaomi adds 3 new smartphone manufacturing units, first PCB plant

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Make in India: Xiaomi adds 3 new smartphone manufacturing units, first PCB plant

Xiaomi now boasts six smartphone manufacturing plants in India.
Published: April 9, 2018 12:45 PM IST
Xiaomi-India-PCB-manufacturing.jpg

Days after the government imposed 10 percent duty on Printed Circuit Board (PCBs) and other components in India, Xiaomi today unveiled three new smartphone manufacturing plants in the country, along with its first unit for local manufacturing of PCBs.

At its first-ever Xiaomi Supplier Investment Summit in India today, the Make in India torchbearer amongst smartphone companies Xiaomi announced three new plants in the country for local manufacturing of its smartphones. The event was attended by over 50 global smartphone component suppliers and several dignitaries including Amitabh Kant (CEO, Niti Aayog), Ramesh Abhishek (Secretary of DIPP) and Deepak Bagla (CEO, Invest India), among others.

With the addition of the three new smartphone manufacturing facilities, Xiaomi now boasts a presence of six manufacturing plants in India. Last year, the company started local manufacturing of power banks, at its first such unit in the country in partnership with Hipad Technology in Noida, Uttar Pradesh.

In line with its Make in India plans, Xiaomi’s first SMT (Surface Mount Technology) plant dedicated towards local manufacturing of PCBA (Printed Circuit Board Assembly) units is located in Sriperumbudur, Tamil Nadu, in partnership with Foxconn. The new facility has a total campus area of 180 acres.

The new factories with Foxconn now employ more than 10,000 people, of which more than 95 percent are females. Xiaomi further reveals that the new units will result in an increased production capacity of two smartphones per second during operational hours.



On the sidelines of the announcement, Manu Kumar Jain, Vice President, Xiaomi Global and Managing Director, Xiaomi India said, “Xiaomi’s high-quality, well-designed products at honest prices have been instrumental in disrupting the Indian smartphone industry. 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. Xiaomi is one of the pioneers in the country to start local assembly of PCBAs, and I believe we will continue to play a key role in transforming India into a global manufacturing hub.”

Earlier this month, the government increased the import duty on three components used in mobile phones – printed circuit board (the motherboard), camera modules and connectors. Among these, the PCBA is one of the most important components and contributes to nearly 50 percent of the value of the phone.
The government’s move is aimed at boosting local manufacturing. Xiaomi expects to ramp up its PCBA production to close to 100 percent of its locally produced phones within Q3 CY 2018. This would allow the manufacturer to keep the costs of the smartphones low, without having to pay an additional fee as import duty.


Xiaomi’s first local manufacturing plant, in partnership with Foxconn, was set up in 2015. Two years later, it set up the second plant, with the third plant established last year which is dedicated to manufacturing power banks. The company claims that every phone sold in India is made in India.

The debut summit is also aimed at educating suppliers about Indian manufacturing ecosystem, and helping them set up local manufacturing units in India. If the suppliers start manufacturing locally, it is estimated to lead to one of the biggest ever single investment in the electronic manufacturing industry and also create a number of jobs. It is estimated to bring in an added investment of over Rs 15,000 crore ($2.5 billion) and create as many as 50,000 job opportunities in the country.

Make in India: Xiaomi adds 3 new smartphone manufacturing units, first PCB plant


@Bali78 @Aashish @Nilgiri @randomradio others
 
Make in India: Xiaomi calls on global component makers to boost local manufacturing

Xiaomi said it sees a lot of opportunities in India as it is among the largest smartphone markets.
Published: April 9, 2018 5:09 PM IST

xiaomi-manu-kumar-jain.jpg


Handset maker Xiaomi today hosted more than 50 of its global component suppliers here to showcase opportunities in India, a move that it believes can bring as much as Rs 15,000 crore (about USD 2.5 billion) in investment and create up to 50,000 jobs in the country.

The Chinese firm has six smartphone manufacturing plants in India in partnership with Foxconn and Hipad.

It said it sees a lot of opportunities in India as it is among the largest smartphone markets.

“If these companies (suppliers) choose to invest here, there is an investment opportunity of over Rs 15,000 crore and can generate employment for over 50,000 people,” Xiaomi VP and India Managing Director Manu Jain told reporters here.

He added that if all the suppliers set up base in India, this would lead to one of the biggest ever single investment in the electronic manufacturing industry.

The suppliers’ summit which kicked off today will continue till April 11. The component suppliers will visit Uttar Pradesh and Andhra Pradesh to explore and learn about investment opportunities in India, including incentives offered by the Centre and state governments, FDI policy, industrial policy and various state sector specific policies.

“The objective of the summit is to educate Xiaomi’s global component suppliers about India’s smartphone industry and encourage them to establish local bases in the country,” Jain said.

Xiaomi, which is among the top smartphone players in India, started assembly of smartphones in India in 2015 and had two manufacturing units in partnership with Foxconn.

The company has now set up three new smartphone manufacturing units in Tamil Nadu and Andhra Pradesh, along with a facility for printed circuit board (PCB) manufacturing in India.

While the company didn’t disclose investment details, it said the move will double its manufacturing capacity in India.

“We had two facilities for smartphone manufacturing earlier. Now we have added three more in Sri City, Andhra Pradesh and Sriperumbudur in Tamil Nadu. These are in partnership with Foxconn,” Jain said.

Besides, a small number of phones are also being made in Noida with another partner – Hipad, he added.

These facilities employ over 10,000 people and 95 per cent are women, Jain added.

Xiaomi is also setting up a new PCB assembly unit in Sriperumbudur in partnership with Foxconn.

“We are committed to manufacturing in India. PCB is 50 per cent of the value of a phone… By Q3, all Xiaomi phones made in India will have PCBs that are locally assembled,” he said.


Make in India: Xiaomi calls on global component makers to boost local manufacturing
 
What do you have to say , bro @Bali78

I don't agree with your conservative view . But with new discoveries regarding substitution of oil and it's derivatives , electronics is going to be if it's not our single biggest import . That too from China .However , unlike the Chinese , from anecdotal evidence , this is not going to be a JV . We aren't gaining any knowledge / ToT

My 2 cents -

We need the NITI Aayog to come up with a comprehensive policy cum road map about how we're going to be self sufficient in electronics. We need the big guns in Indian Industry - the Ambanis , the Tatas , the Birlas coupled with funds from the GoI to come up with a holistic plan + road map however outdated the tech at present . It's the Tejas analogy at work . Tedaa hain par meraa hain , else we'd never get started much less get going .

MMS paid lip sympathy much like the SEZ cum SC ( Semi Conductor . He even signed up a few agreements with Jaypee , etc .) policy which went kaput under UPA - 1 given Clashes between 2 biz communities on how much benefit they and the Congress scum could derive , viz Kamal NATH led Marwaris & PC led Chettiyars on the SEZ real estate scam .These pimps then compensated with the MNREGA scheme ( Pls note the timing of both )

For the first time , Reliance which went on record ,( courtesy Burkha Dutt ) & which considered Congress their Dukaan , were forced to back off . Half of MUKESH Ambani died that day. He then pursued and got his compensation , courtesy 4 G. Something which pidis like GND , VSdoc & especially our senile friend the one & only windbag , appreciate , given their investments there but breastbeat here .

Loved penning the post .

Your views , please
 
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What do you have to say , bro @Bali78

I don't agree with your conservative view . But with new discoveries regarding substitution of oil and it's derivatives , electronics is going to be if it's not our single biggest import . That too from China .However , unlike the Chinese , from anecdotal evidence , this is not going to be a JV . We aren't gaining any knowledge / ToT

Your views , please

Bro, I am not at all conservative :). What I am suggesting is not to look at the past, but create something for the future. The success of semiconductor industry spanned from 1970s till mid 2013. Right now the industry has become a commodity and there is no point in investing in that.
How ever the real money is in developing smart systems, devices which will empower our life style in future. For example consider this robotic vacuum.
https://www.amazon.in/iRobot-Roomba...D=41mtT9860%2BL&preST=_SY300_QL70_&dpSrc=srch

This one costs around Rs 60k. But if you add all the sensors, processor and cameras, it won't cost more Rs3-4k !! Total bill of material including motor will not be more than Rs10k. Then who gets the lion's share out of that 60k ? It's the software and the smart algorithm which is running on that processor and controls the motion based on the feedback from sensors.
Indian should concentrate on creating such smart systems and make real money!! Right now the whole system is getting imported i.e. Rs 50k (Excluding profit of seller). If we build this system in India, total import bill will be Rs 3-4k.
Which option is lucrative? Target a segment of Rs3-4k or Rs30k ??

All I am suggesting is to go for value addition than following a commodity segment.

Didn't we make the same mistake when our software biggies were busy serving US companies rather than creating our own facebook or whatsapp ??
 
Bro, I am not at all conservative :). What I am suggesting is not to look at the past, but create something for the future. The success of semiconductor industry spanned from 1970s till mid 2013. Right now the industry has become a commodity and there is no point in investing in that.
How ever the real money is in developing smart systems, devices which will empower our life style in future. For example consider this robotic vacuum.
https://www.amazon.in/iRobot-Roomba-980-Vacuum-Cleaning/dp/B017WD5KZM/ref=sr_1_1?ie=UTF8&qid=1523306264&sr=8-1&keywords=roomba+980+vacuum+cleaning+robot&dpID=41mtT9860%2BL&preST=_SY300_QL70_&dpSrc=srch

This one costs around Rs 60k. But if you add all the sensors, processor and cameras, it won't cost more Rs3-4k !! Total bill of material including motor will not be more than Rs10k. Then who gets the lion's share out of that 60k ? It's the software and the smart algorithm which is running on that processor and controls the motion based on the feedback from sensors.
Indian should concentrate on creating such smart systems and make real money!! Right now the whole system is getting imported i.e. Rs 50k (Excluding profit of seller). If we build this system in India, total import bill will be Rs 3-4k.
Which option is lucrative? Target a segment of Rs3-4k or Rs30k ??

All I am suggesting is to go for value addition than following a commodity segment.

Didn't we make the same mistake when our software biggies were busy serving US companies rather than creating our own facebook or whatsapp ??
Then we should be taking over such firms like the Chinese . That would be the beginning ....
 
What do you have to say , bro @Bali78

I don't agree with your conservative view . But with new discoveries regarding substitution of oil and it's derivatives , electronics is going to be if it's not our single biggest import . That too from China .However , unlike the Chinese , from anecdotal evidence , this is not going to be a JV . We aren't gaining any knowledge / ToT

My 2 cents -

We need the NITI Aayog to come up with a comprehensive policy cum road map about how we're going to be self sufficient in electronics. We need the big guns in Indian Industry - the Ambanis , the Tatas , the Birlas coupled with funds from the GoI to come up with a holistic plan + road map however outdated the tech at present . It's the Tejas analogy at work . Tedaa hain par meraa hain , else we'd never get started much less get going .

MMS paid lip sympathy much like the SEZ cum SC ( Semi Conductor . He even signed up a few agreements with Jaypee , etc .) policy which went kaput under UPA - 1 given Clashes between 2 biz communities on how much benefit they and the Congress scum could derive , viz Kamal NATH led Marwaris & PC led Chettiyars on the SEZ real estate scam .These pimps then compensated with the MNREGA scheme ( Pls note the timing of both )

For the first time , Reliance which went on record ,( courtesy Burkha Dutt ) & which considered Congress their Dukaan , were forced to back off . Half of MUKESH Ambani died that day. He then pursued and got his compensation , courtesy 4 G. Something which pidis like GND , VSdoc & especially our senile friend the one & only windbag , appreciate , given their investments there but breastbeat here .

Loved penning the post .

Your views , please

What we need is to setup battery plants and solar power generation ecosystem. Unless you have these in place, you cannot be self reliant in the coming 30 years. If you have surplus power generation, you can bring down overall production costs.
 
What we need is to setup battery plants and solar power generation ecosystem. Unless you have these in place, you cannot be self reliant in the coming 30 years. If you have surplus power generation, you can bring down overall production costs.
There's Adani for the latter.No clue about the former . But be That as it may , we need chip designing and manufacturing tech on a commercial scale , come what may . We also need Indian CG cos - designing developing & manufacturing these for our domestic consumption and export .


I had high hopes of Modi in this field .God Knows , after beseeching the top brass of VOLTAS for years , the Tata group finally consented to a measly tie up with a Turkish major group in CG - the full contours of which are not visible even today .As though , I & the rest of the management were pocketing a share of the profits.

It's all about profits .There are very few in the most premier industrial house in India willing to think beyond. And if this is the case with Tatas , do we even discuss Reliance or the Birlas or other surviving Indian Industry.

The BPL's Videocon's etc are dead or dying .Godrej has shifted it's attention to real estate. Onida is just about surviving . Micromax , Lava ....????


Voltas, Turkish co in $100-m venture for consumer durables
 
We are almost 20 years behind China in EMS. China started building manufacturing parks for companies like Flextronics and Solectron (now acquired by Flextronics) in late 90's.

Seriously, India should pursue Flextronics and Sanmina SCI to move its EMS manufacturing to India - they have all - from 18-20 layered PCB manufacturing, they make all Enclosures - plastics and metal, source all components from the biggest of the Suppliers and do all modules like PCBA - using SMT, Power supplies and you name it. Also, they span over a wide range of products in the EMS space, not just cell phones.

In addition, getting Apple and Foxconn to move lock stock & barrell to India would be super.

This is simply the back-end of the EMS. India needs to get into the front-end technologies of chip manufacturing too.
 
This is simply the back-end of the EMS. India needs to get into the front-end technologies of chip manufacturing too.


Yup, but for now have to move in the proper sequence w.r.t job creation/capex insertion.

Capex heavy source source OEM like chips will be the last thing. They don't really give a lot of jobs and neither are they the bulk of imports (value wise) that India is still doing from East Asia in electronics. But definitely once things have stabilised in this current push (and there is long way to go on it), that should be the final push at scale, there will be more margins to do it sustainably then too.
 
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