Taiwan handset ODMs losing orders from regional brands to China rivals
Daniel Shen, Taipei; Steve Shen, DIGITIMES [Thursday 26 June 2014]

Taiwan-based handset ODMs are losing orders from regional brands in Southeast Asia, Latin America, the Middle East and Europe to China-based rivals due to price competition and concerns of shipment volumes and inventory risks, according to sources at Taiwan’s handset ODMs.

A number of regional brands have emerged as major handset suppliers in their respective regions, buoyed by their ability to offer multiple models with high price/performance ratios in a timely manner, the sources noted.

Micromax, Karbonn and Spice have emerged as leading local brands in India, with Micromax serving as the second-largest handset brand in the country with a 20% share, trailing after only Samsung Electronics.

While China-based Huawei, ZTE, Xiaomi Technology, Coolpad and Lenovo have established strong presences in the international handset market, a number of other local brands including Meizu, Vivo, K-Touch and Gionee have prevailed in certain designated segments locally, said the sources.

Emerging local brands also include EverCross, Mito and Nexian in Indonesia, Cherry Mobile in the Philippines, Q-Mobile in Vietnam and Wiko in France, revealed the sources.

Wiko has been cooperating with China-based ODM Tinno Mobile Technology and has taken the third position in France’s handset market, trailing after Samsung Electronics and Apple, indicated the sources.

A number of regional brands are cooperating with China-based handset ODMs or handset design companies such as Wingtech, Longcheer, SIM Technology and Ragentek Communication Technology, said the sources.

In addition to having strong production capacity, the China-based ODMs are also offering prices 10-30% below those offered by Taiwan-based ODMs, putting them at a major disadvantage to compete, commented the sources.

Taiwan’s major ODMs including FIH Mobile, Arima Communications, Compal Communications, Quanta Computer, Qisda, Inventec and Gigabyte.

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