BBK Group joins hands with Dixon Technologies, Karbonn Group for manufacturing of phones  

BBK Group, China’s largest mobile phone maker, has reportedly joined hands with Indian manufacturers, such as Dixon Technologies and Karbonn Group, for the production of its Oppo, Vivo and Realme smartphones. The company, which is keen on availing of the Production-Linked Incentive (PLI) scheme, has been pushed to engage local players as per Government of India's rules to involve local partners, a report in the Economic Times said.

Oppo and Vivo already have large manufacturing units in India. The units make the entire range of BBK Group brands, such as Oppo, Vivo, Realme, OnePlus and iQoo. The current move comes despite the Indian government strict actions against Chinese smartphone companies in the past. Chinese smartphone companies are cautious about directly investing in their own plants for capacity expansion after increased scrutiny in the last few years, ranging from alleged customs duty and income tax evasion to money laundering, the report said.

Oppo and Vivo have not applied for PLI benefits. Partnering with contract manufacturers who have already done so will help them become competitive, especially since competitor Samsung is a PLI beneficiary, a source told ET. BBK Group continued to lead the Indian smartphone market with revenue of Rs 81,870 crore in 2022-23.

It was previously reported that the government has been encouraging Chinese mobile phone firms to collaborate with local partners for manufacturing and distribution, as well as to appoint Indian executives in key management positions. The aim is for companies from China to increase their value-addition activities in India, such as producing components locally.

Last month, Dixon managing director Atul Lall said that the company will be finalising deals with two large global phone brands. “Production should commence in the next couple of months for one of the largest global brands. For another customer, which is again one of the largest global brands, it should commence within the next four to six months.”

Market tracker Counterpoint Research data has stated Vivo, Oppo, and OnePlus increased their market share by up to two percentage points in the calendar year 2023 compared to the previous year, while Xiaomi and Realme saw year-on-year improvements in the October-December quarter of 2023.

BBK Group has two primary sales divisions in India. Oppo Mobiles India records sales for Oppo, OnePlus, and Realme brands, while Vivo Mobile India accounts for sales of Vivo and iQoo. The recent financial report of Oppo Mobiles India filed with the RoC shows a 9% decrease in sales, amounting to Rs 51,994 crore in 2022-23, which was attributed to challenging market conditions. In contrast, Vivo Mobile India experienced an 11% increase in sales, reaching Rs 29,875 crore.

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