OPPO wants to form a manufacturing JV in India
What's the story
Chinese smartphone giant OPPO is in talks with Indian electronics makers Amber Group and Bhagwati Products to form a manufacturing joint venture (JV) in India, as per Moneycontrol. The move comes as part of a larger restructuring strategy by the company. The discussions are aimed at further integrating OPPO's India operations with its sub-brands OnePlus and Realme.
Strategic transition
Transition to localized manufacturing by end of year
The talks for an India manufacturing JV have been going on for some time, a source told Moneycontrol. The company is looking to transition to a more localized manufacturing structure by the end of this year. This move is not just about localizing production but also separating manufacturing from distribution, sales, and backend functions.
Regulatory challenges
Feasibility of partnership with Bhagwati Products
The restructuring comes as OPPO faces tighter regulatory scrutiny of Chinese smartphone companies and a government push for localization. Both Amber Group and Bhagwati Products are in talks with the company. A partnership with Bhagwati could be more feasible due to its existing collaboration with Huaqin, China's top original device manufacturer (ODM) that designs smartphones for OPPO and Vivo.
Operational alignment
Current operational setup at Greater Noida factory
Bhagwati Products has leased a large part of OPPO's Greater Noida factory and operational infrastructure. The arrangement is similar to the one at Vivo's Greater Noida facility, which Bhagwati took over as part of its contract manufacturing expansion plans. The Bhagwati-Huaqin joint venture is already producing OPPO smartphones from both the Vivo factory and a section of OPPO's Greater Noida facility.
Partnership pursuit
OPPO's search for Indian partner since 2024
OPPO has been on the lookout for an Indian partner since 2024, after the Indian government urged Chinese electronics and smartphone firms to bring in local partners for manufacturing. The move comes amid increased regulatory scrutiny of Chinese smartphone firms over alleged irregularities such as customs duty evasion, income tax violations, and money laundering.