Vivo, the Chinese smartphone manufacturer, plans to open one of India’s largest mobile phone manufacturing facilities in Greater Noida next month. The new plant, with an annual capacity of 120 million devices, is a substantial investment of over ₹3,000 crore. Vivo is aggressively looking for an Indian partner to handle its manufacturing activities. Several potential partners are now in talks, including the Tata Group, the Murugappa Group, and Indian contract manufacturer Dixon Technologies.
Search for an Indian Partner
However, no deals have been reached due to disagreements about valuation. According to a source quoted in the paper, Vivo wants a strong Indian partner for its operations. While nothing has been resolved on the JV, discussions are ongoing with a few stakeholders.
Transition to the New Facility
The company recently closed its previous manufacturing facility, which had an annual capacity of 40 million gadgets. Bhagwati Enterprises, the manufacturing unit of Micromax Informatics, has now taken over this plant. Vivo’s new facility, which spans 170 acres, is comparable to Samsung’s mobile phone manufacturing factory, the country’s largest, which has an annual capacity of 120 million units and was opened in 2018.
Tata Group and Dixon Technologies Discussions
The Tata Group was in talks with Vivo earlier this year, but is now focused on integrating the local subsidiary of iPhone contract producer Wistron, which it purchased last year. Dixon Technologies acknowledged started conversations with Vivo about a joint venture, comparable to a previous agreement with Transsion Holdings. Dixon purchased a 50.10% share in Transsion’s Ismartu India unit for ₹238.36 crore in April, with ambitions to raise to roughly 55% in the future.
Government Encouragement and Scrutiny
Chinese companies, notably Vivo, have been under intensive scrutiny from Indian tax and foreign currency regulators, especially given the continuing border tensions. While the Indian government wants Chinese smartphone firms to form joint ventures with Indian enterprises, it has stated that failure to do so will not risk their investments in the domestic market. Vivo’s strategic decision to create a major production plant in India demonstrates the company’s commitment to growing its footprint and operational capabilities in the Indian market.
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