May 31: Chinese electronics giant Xiaomi is set to manufacture its television sets in India ahead of the Diwali season. According to senior executives, the company will partner with Taiwanese contract manufacturer Foxconn to manufacture its products in India, instead of importing them. With the move, the company aims to dominate the online sales in the upcoming festive season.
The smartphone giant has a huge customer base in India, and the decision to begin manufacturing its television sets in the country is expected to bring forth tax benefits for the company. However, the company does not intend to reduce the price for the television sets as they are already available at low rates. There is news that the company will build a local component sourcing base in India.
An industry executive has been quoted as saying by news reports that the company is having its final discussions with Foxconn to manufacture televisions in Indian by July-August. Most of the television products for Diwali sales will be made in India.
The company looks forward to establish itself as the largest online television brand before it expands into multi-brand stores. The local manufacturing, apart from reducing the taxes will also help the company control the supply chain and ensure more availability of television.
The company is set to open a television manufacturing unit in India in 2018 and the company continues to evaluate its opportunity in the country. The Taiwanese manufacturer, Foxconn have not commented on the news.
Due to import tax changes and depreciation of rupees, Xiaomi India recently increased the cost of its 55 inch TV by Rs 5000 to Rs 44999. Over the past five months, India increased import duty on completely built television sets to 20% from 15%, while the tax on finished LED TV panels imported for local assembling remained 15%.
Japanese company Sony had earlier began manufacturing television sets in India in partnership with Foxconn. Other companies that are exclusive online are also going for local manufacturing to elude the taxes and to control the supply chain.
In India, Foxconn is the largest manufacturer of Xiaomi smartphones. Currently Xiaomi has around six third party plants in in India. Recently, the company had announced a printed circuit board assembly unit at its Tamil Nadu facility in partnership with Foxconn. Over 95% of the Xiaomi smartphones sold in India are manufactured locally.