ZTE, the renowned Chinese telecom equipment maker, is considering undertaking contract manufacturing in India as a part of its cost-cutting measures. The company has also decided to slash its workforce in the country by 30 per cent to ride over a flat telecom market.
Speaking to Business Line, Cui Liangjun, CEO, ZTE Telecom India Pvt Ltd, said, “It’s a tough market so we had to undertake cost-cutting measures globally, including India. Most operators in India have expansion plans but have put it on hold due to the uncertainty.”
The company has also combined its small R&D team in Bengaluru with its services team. ZTE aims to have about 1,000 direct employees and another 500 outsourced jobs after the laying off happens. More than 500 jobs will be affected during this process.
Liangjun said the employees who lose their jobs in India are being given an opportunity to work in ZTE’s other markets. ZTE’s India revenues have declined from 8 per cent of its global revenues a few years ago to 5 per cent now due to a depressed market. “We are in talks with both Indian and international players for contract manufacturing. We will see what is cheaper for us,” Liangjun said, adding that the company has contract manufacturing partnerships in Europe and Brazil.
ZTE has a plant in Gurgaon that is responsible for manufacturing fixed line broadband equipment but the company might expand itself in to wireless gear, if something big comes up. “We will expand on our own or we will have partnerships for contract manufacturing. We will have the details in the next 2 to 3 months,” he said.
