Xiaomi Supplier Dixon To Set Manufacturing Plant Near Delhi Amid Localisation Push

Chinese smartphone manufacturer Xiaomi supplier Dixon is gearing up to invest over INR 400 Cr ($48.2 Mn) in a new manufacturing facility located on the outskirts of New Delhi.

Spanning 300,000 square feet, the plant will primarily focus on producing Xiaomi smartphones and is expected to be officially inaugurated by a government representative by the end of this month, according to a Bloomberg report.

The development comes amid the Indian government’’s push for localisation in mobile phone production, which has led Beijing-headquartered Xiaomi to forge a partnership with Dixon Technologies. The new collaboration requires Xiaomi to oversee everything from device assembly to distribution within India.

The factory’s inauguration, expected by the end of the month, will be officiated by a government official.

Consequently, Xiaomi’s previous suppliers in India, including Taiwanese company Foxconn Technology Group’s Bharat FIH and China’s DBG Technology Co., could face business losses.

Earlier this year, Xiaomi had also collaborated with Indian company Optiemus to manufacture wireless audio products at the Optiemus’ Uttar Pradesh fractory. At that time, the company said it is “committed to forging more such collaborations for a wider range of categories, across our product line-up”.

Xiaomi has joined a growing list of smartphone manufacturers that are looking to start production in India. The recent past has seen giants such as Apple and Samsung set up their manufacturing plants in India, along with their suppliers and vendors.

Tech giant Apple also began iPhone 15 production at Foxconn’s factory in Tamil Nadu last month. It is also planning to make the India-built iPhone 15 available in the country and some other regions on its global sales debut day (September 15).

The Indian smartphone market faced a challenging beginning in 2023, experiencing its first-ever drop in shipments during the first quarter, down by 20% compared to the previous year, as per a report. The market is still dealing with inconsistent demand, and there is a risk of excessive stockpiles in distribution channels.

In this period, Samsung maintained its leading position with a 21% market share, shipping 6.3 Mn smartphones. OPPO surpassed vivo and Xiaomi to secure second place with 5.5 Mn shipments, thanks to successful launches of new products. Xiaomi slipped to fourth place, shipping 5 Mn units.