Oppo And Vivo In Talks With Dixon, Lava, Others To Partner For India Operations

Chinese smartphone companies Oppo and Vivo have initiated talks with a host of Indian companies in the handset sector as they scout for potential partners for their operations in India.

“Oppo and Vivo have initiated initial discussions with several companies, including Indian contract manufacturers. They have also received interest from large Indian firms eyeing entry into the consumer space,” Moneycontrol reported, citing sources close to the matter.

This comes at a time when major Chinese smartphone companies in India are facing increased scrutiny, with allegations ranging from customs duty and income tax evasion to money laundering.

As per the report, Oppo and Vivo are currently engaged in discussions with Dixon, Lava International, Optiemus, Bhagwati (Micromax), and UTL Neolyncs.

“These Chinese firms seek stronger financial partners and are holding multiple rounds of preliminary talks with domestic firms approved under the Production-Linked Incentive (PLI) scheme by the government,” another source told Moneycontrol.

Dixon Technologies is reportedly exploring the possibility of acquiring a majority stake in the Indian unit of China’s Transsion Holdings.

The development comes at a time when the Indian government is leaving no stone unturned to promote its ‘Make In India’ initiative. The Centre wants Indian companies to have more hold over the country’s mobile phone industry, which is currently dominated by Chinese brands like Xiaomi and Oppo among others, as part of an informal mandate, according to the media report.

The Indian government has repeatedly encouraged Chinese phone manufacturers to engage Indian partners in their local operations and appoint Indian executives to key leadership positions. Its goal is for the Indian partner to maintain a minimum 51% stake in any prospective joint venture, ensuring substantial domestic influence in an industry largely dominated by Chinese brands.

In addition to joint venture discussions, Chinese firms with manufacturing facilities are also in advanced talks with domestic companies to outsource smartphone manufacturing, leveraging PLI benefits.

As per Moneycontrol, Dixon is in the final stages of bringing Oppo and Vivo on board as customers. The company currently manufactures smartphones and feature phones for brands such as Xiaomi, Motorola, and Samsung.

Meanwhile, Chinese mobile phone maker BBK Group has partnered with Indian manufacturers Dixon Technologies and Karbonn Group for the production of its Oppo, Vivo and Realme smartphones.

Chinese smartphone brands like Xiaomi and Realme have also employed Indian entities for distribution.

Besides, Apple is also rapidly ramping up manufacturing in India amid geopolitical tensions between Beijing and Washington. India now accounts for about 7% of total iPhones produced globally. 

Apple started ramping up production in India in 2021 amid disruptions in its supply chain due to the COVID-19 pandemic restriction in China and rising tensions between Beijing and Washington. 

Apple manufactured iPhones worth INR 1 Lakh Cr in India last year.