Emir BardakçıIndian giant Tata Electronics is in discussions with leading Chinese smartphone brands Xiaomi and OPPO to commence providing Original Equipment Manufacturing services for their devices, reported the Economic Times of India. According to reports, this forms part of Tata’s ambitious plans to become a significant player in the EMS ecosystem, just like Taiwan’s Foxconn, which is the world leader in manufacturing smartphones.
Scaling Up the EMS Ecosystem
An insider familiar with the discussions noted:
Essentially, Tata Electronics has been aware that to become one of the top players in the electronic manufacturing services ecosystem, it needs to scale up now.
In addition to Xiaomi and OPPO, this development represents the larger game plan of Tata Electronics, whose ambition has grown beyond the simple making of casings for Apple iPhones, into the whole devices and all other components involved in the system such as cameras and display modules, in the broader process chain, aligned with their ambitions to scale up the value chain for making smartphones.
Aiming to Be the “Indian Foxconn”
With all its resources and experience, Tata Electronics is likely to try to emulate the Foxconn model: to become a leading player in the global smartphone manufacturing business. A tie-up of this nature would also extend the portfolio of Tata, which currently makes casings for Apple iPhones, among other products, to include companies like Xiaomi and OPPO. “They have been holding discussions with top Chinese smartphone players, including Xiaomi and Oppo, for component manufacturing,” said another source.
This also aligns with the greater vision of Tata to become a versatile EMS provider that could make India a bigger player in the global supply chain of electronics.
Impact on the Smartphone Market
For Tata Electronics:
- The joint venture could substantially improve its revenue and market position, thereby increasing India’s status as a major smartphone manufacturing hub.
- This will also help Tata Electronics move up the value chain by manufacturing higher-value components, such as cameras and display modules.
For Xiaomi and OPPO:
- Collaboration with Tata Electronics can help Chinese smartphone brands establish a stronger foothold in India.
- Local manufacturing would bring the production costs down and their devices would then compete in a far more realistic manner within the Indian market.
- Closer ties with Tata may reduce geopolitical headwinds that periodically complicate operations for Chinese companies in India.
For India:
The move might lead to job creation and give a boost to India’s position in the hub of manufacturing smartphones.
- The expansion of Tata has come in tandem with the initiative of the Indian government, “Make in India,” promoting local production and lessening imports.
This could be the magic moment for the Indian EMS sector in potential partnerships between Tata Electronics and Xiaomi-OPPO. If everything goes well, Tata’s dream to be “Indian Foxconn” might just reshape the face of smartphone manufacturing in India, furthering innovation and economy in the country while growing the collaboration between Indian and Chinese tech giants. This development underlines the increasing role taken by India within the global ecosystem of electronics and forms the genesis for more upgrades to be expected over the coming years.
