Samsung is scheduled to start manufacturing important components for mobiles from its Noida factory from April 2019. According to new information, the components that the company is planning to start making from the factory include touch panels, display screens and vibration motors for smartphones. This information comes right after the government “backtracked on its plan” to add customs duty on these components from February 1, 2019. This withdrawal came as a relief for the smartphone giant as it is currently competing with Chinese smartphone makers for market share in the Indian smartphone segment. The competition is quite evident as Samsung lost the top spot to Xiaomi back in September last year.
As part of a long term strategy to return to the top spot, the company increased its focus on India-centric innovations and features while improving the scope of “local value addition” in the production process. According to a report by the Business Standard, the company is moving to “Complete-knocked Down” (CKD) manufacturing. However, things changed when the government made changes to its phased manufacturing programme deadline which prompted Samsung to send a letter to the Prime Minister’s Office to share concerns about the long term sustainability of the local manufacturing unit.
In the letter, Samsung added that the early notification for local production would prompt the company to stop production at its local unit and cut its production estimates from 40 percent to 15 percent. Now with the manufacturing scheduled to start in April, the company is expected to meet the deadline. The report also indicated that the government may increase the deadline to April 1, 2020, considering most smartphone makers are yet to met the previous deadlines set in 2017-18 and 2018-19
The report added that Samsung will not restart its production of televisions in the country after stopping it early last year because of 5 percent import duty on TV panels. Instead, the company is now importing “fully-finished TV sets from Vietnam” without the need of paying any import duty. For the production to start in the country, the company stated that the government needs to make the “local TV production more competitive”.―BGR India