Gionee plans to continue manufacturing in India post-demonetisation

The Dollar Business Bureau

Chinese smartphone manufacturer Gionee on Sunday confirmed it will stick to its plans of manufacturing mobile handsets in India despite being hit by Prime Minister Narendra Modi’s demonetisation scheme.

“Yes, of course, we are committed to Make in India and planning to set up a manufacturing unit spread across 50 acres in Faridabad at a cost of Rs.500 crore,” Gionee India CEO and Country Head Arvind Vohra told PTI.

When asked about the company’s plans of manufacturing mobiles in India post-demonetisation, Vohra said, “With demonetisation, the market had undoubtedly slowed down, but is getting back on track with the cash crunch situation easing. Sales declined 20% in the first two to three days, but with partial recovery now the decline is 8-10%. The capacity of the unit will be 30 million units and it should be operational in about two years.”

Gionee is betting big on the Indian market, as it plans to not only tap the growing demand of cellphones in the country but also export its mobiles to various African and South East Asian countries.

At present, Gionee sells almost 60% of its locally-manufactured products, produced by Foxconn (Tamil Nadu) and Dixon (Noida) of Dixon Technologies.

To mitigate the effects of demonetisation, Gionee said distributors would play a pivotal role in increasing the credit cycle to retailers, and that both retailers and brands were needed to give lucrative offers to the cash-hit consumers.

Referring to 4G handset shipping scenario, Vohra said, “We are seeing a quick change in the growth of 4G handsets shipment since 2016, and it will be an upward trend in coming years too.”