- Bharat FIH’s Xiaomi orders went down by 70% from 2021 to 2023.
- The company now plans to expand into new sectors.
- The plant has an exceptional capability to expand as and when required.
Foxconn’s subsidiary Bharat FIH is diversifying its manufacturing operations from android phones. The company is expanding into new sectors including telecom equipment, electric vehicles, televisions, and displays.
The company is exploring opportunities in various segments, including those supported by the Production Linked Incentive (PLI) scheme. This would align with the Indian government’s vision of making India self-reliant in electronics manufacturing.
Key reason for this diversification is to counteract a decrease in orders from Xiaomi, its main client. Bharat FIH’s heavy reliance on Xiaomi has impacted its scale, its Xiaomi orders went down by 70% from 2021 to 2023.
Xiaomi’s handset production in India has declined as its sales came down by 38% in two years from 2021. This is due to a government crackdown on Chinese businesses in India. The company has also started diversifying its Electronics Manufacturing Services (EMS) partners, further affecting Bharat FIH’s business.
The company, without disclosing its operating capacity, claims to have an exceptional capability to expand as and when required. Bharat FIH’s facility in Sriperumbudur is currently focusing on surface-mount technology (SMT) operations and some assembly, testing, marking, and packaging (ATMP) operations for specific segments.
Bharat FIH, located near Chennai, is currently fourth in India’s mobile phone contract manufacturing market, dominated by Dixon, Foxconn, and DBG Group. The company’s diversification efforts are expected to take time to yield results, as established local players are already making significant strides in the new segments Bharat FIH is targeting.
Bharat FIH was among the global firms chosen to avail benefits under the PLI scheme for smartphones in 2021, but it has failed to meet its production targets, resulting in the loss of potential incentives. Although the company manufactures for Nokia too, but mostly phones that cost less than ₹15,000. The PlI incentives are valid for the phones above ₹15,000. The stagnant smartphone market in India and competition from established players pose challenges for Bharat FIH’s growth in the smartphone segment.
