Samsung’s largest factory opens up in India, fierce competition sets in within industry

Samsung’s largest factory opens up in India, fierce competition sets in within industry

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MUMBAI: Samsung Electronics has formally set-up a new factory in India, which the South Korean tech group says is the world’s biggest mobile phone manufacturing plant till date.

The factory in Noida, on the outskirts of New Delhi, will allow Samsung to make phones at a lower cost due to its scale at a time when other phone making hubs such as China are getting relatively more expensive, analysts tracking the sector said.

On Monday, the factory inaugurated jointly by Indian Prime Minister Narendra Modi and South Korean President Moon Jae-in, will also help Samsung compete more effectively with competitors such as China’s Xiaomi, which serves as India’s biggest smartphone brand by shipments earlier this year.

“This 50 billion-rupee investment will not only strengthen Samsung’s business ties in India, it will also play a key role in India-Korea relations,” Modi said in a speech in Hindi at the inauguration of the plant.

Samsung said last year it would spend 49.2 billion rupees ($716.57 million) over three years to expand capacity at its Noida plant.

Apparently, the new factory will help Samsung double its current capacity for mobile phones in Noida to an annual 120 million units after the phased expansion plan is complete, the company said in a statement.

India, being the world’s second biggest smartphone market and home to more than a billion wireless subscribers, is big opportunity for Samsung where slow smartphone earnings growth has fueled concerns that its mobile business is running short of ideas to underpin sales of its premium Galaxy devices.

 

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