Samsung bets big on India, plans to expand production plant

Jun 7, 2017

In a bid to solidify its leadership position in the fast-growing India market, global market leader Samsung Electronics is reported as planning to spend around 700 billion won ($625 million) in India in order to boost production by establishing a manufacturing plant in India.

The Indian economy is growing even faster than China and that explains why Samsung is reportedly planning to expand its manufacturing plant located in the northern state of Uttar Pradesh. According to Asia Nikkei, the Korean giant plans to double the monthly output capacities of its mobile phones and refrigerators production to 10million units and 200,000 units respectively as early as 2018. The size of the manufacturing plant will also be doubled to 240,000 square meters and additional new lines would be added. The tech giant is expected to announce the investment Wednesday at the earliest.

India is one of Samsung's major market, especially for its smartphone business which is an indicator of how the company may fare in other aspects. The tech giant continues to dominate the standings in terms of market share in the first quarter of 2017 with a 28.1% share according to figures from U.S. research firm IDC. Despite the continued leadership, Samsung's shipment is slightly been eaten up by the recent drive by rival Chinese OEMs who want a share of the market.

But Samsung is not losing steam as it hopes to solidify its lead with new products covering a wide range of market segment. Apart from the high-end Galaxy model, the company is also working strongly on its Tizen-powered budget models. Samsung recently released the Galaxy S8 in India and also launched the Samsung Z4 with India being the first country where the Tizen smartphone went on sale.

Apart from the Uttar Pradesh factory established in 1997, which manufactures mobile phones and refrigerators, the tech giant also own a production plant in Tamil Nadu where it manufactures air conditioners, televisions and washing machines. India's GDP grew by 7.1% in 2016, surpassing that of China for the third straight year. Some industry watchers predict that India could surpass the U.S. to become the world's second-largest smartphone market this year. The new investment could be Samsung's move to position itself in order to be at the forefront of the growth in the market, especially in the mobile phone aspect.

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