Xiaomi, the biggest smartphone maker in India, has joined hands with Dixon Technologies (the homegrown user electronics contract maker) to produce almost 55,000 TV sets every month locally, claimed 2 senior executives of the industry to the media in an interview.
Xiaomi’s agreement with Dixon will probably guarantee an August rollout for the Make-in-India ‘Mi’ brand of TVs, the local manufacture of which must start next month at new Tirupati factory of Dixon. The Chinese company will produce the 43- and 32-inch sets via this deal, which might later be extended to newer models, the officials claimed.
Xiaomi’s agreement with Foxconn (the Taiwanese contract manufacturer) to additionally expand TV production locally is also in the offing, the media reported previous month. This comes as the Chinese firm wishes to guarantee local output for over 90% of the TV sets it trades in India. Foxconn is expected to assemble the 55-inch and above sets at its Chennai factory that also manufactures TVs for Sony.
The Xiaomi-Dixon agreement comprises local manufacture in the open cell route, whereby the firm will import TV panels in the open-cell state. India has no facility of panel fabrication and presently all leading TV makers such as LG and Samsung to save on import taxes import panels in open cell state. Emails sent to Dixon and Xiaomi did not get an answer.
Currently, Xiaomi gives 20% tax for importing its TVs as fully built units, enticing a further 2% surcharge. Local manufacture in open cell route draws only 5% import tax, with 1% extra surcharge.
On a similar note, in April Xiaomi elevated the cost of its 55-inch smart television set to Rs 44,999 by Rs 5,000 owing to rupee depreciation and higher taxes. Xiaomi is looking to turn out to be the biggest online TV brand in India prior to its growth via more conventional modes of buyouts. Besides import taxes, television sets draw 28% GST.