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Xiaomi, which is the third largest smartphone manufacturer in India, has recently made the announcement that it will be opening three smartphone plants in India along with its first Surface Mount Technology (SMT) plant in Chennai that will focus to manufacture Printed Circuit Board Assembly (PCBA) units in Sriperumbudur, Tamil Nadu in association with Foxconn.
While addressing at Supplier Investment Summit, Manu Jain, Vice President of Xiaomi Global and Managing Director stated that Chinese company is one of the pioneers in the country which is going to start printed circuit board assembly (PCBA) units in the country He further added that that company is putting efforts to enhance the knowledge of component suppliers of the manufacturing ecosystem in the country and also helps them to establish manufacturing units in the country. The company reported that if all the component suppliers agree on establishing units in India, it will create a “big pool of jobs and would potentially bring in an added investment of over 15,000 crore rupees ($2.5 billion) and create as many as 50,000 job opportunities in India.”
According to Manu Jain, Vice President of Xiaomi Global, “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”.
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The Supplier Investment Summit was started by several officials namely Amitabh Kant, CEO, Niti Aayog; Ramesh Abhishek, Secretary, DIPP and Deepak Bagla, CEO, Invest India. The three new smartphone plants would be established by Xiaomi in cooperation with Foxconn which are located in Sri City, Andhra Pradesh and in Sriperumbudur, Tamil Nadu. More than 10,000 people are currently working in Foxconn Factories out of them more than 95% are women.
Xiaomi stated, “Additionally, all of the assembly work is done by women. The new factories will result in an increased production capacity of two smartphones/second during operational hours.”
With the opening of first Surface Mount Technology (SMT) plant which is devoted towards local manufacturing of PCBA units in Chennai, Xiaomi is the first Chinese company in the country which is going to start local assembly of PCBA’s units in India. PCBA is an acronym of Printed Circuit Board Assembly and it is the procedure of soldering or gathering several electronic components such as resistors, ICs (Integrated Circuits), capacitors to PCB or printed circuit board.
On another hand, SMT is an acronym of Surface Mount Technology and it is the process of producing electronic circuits wherein the components are positioned directly on the surface of PCB’s. PCBA which is to be considered one of the most important components in the smartphone and contributes to almost 50 percent of the value of the phone.
It is anticipated that Xiaomi would increase its PCBA production close to 100 percent of local- manufactured smartphones during the quarter of 2018. In the views of Tarun Pathal, Associate Director at Counterpoint, the bold move taken by Xiaomi the opening of PCBA units in the country should increase its brand value in terms of value addition in India.
Pathak stated, “The move should increase Xiaomi’s value addition from single digit to close to 15%,” Pathak said.
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