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Lenovo Mobile ramps China production

Posted: 15 Sep 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Lenovo Mobile? handsets? mobile production? China? Cai Yan?

Hoping to challenge China's three leading cellphone brands, Lenovo Mobile is beefing up its arsenal with a huge R&D and manufacturing site in the southern Chinese city of Xiamen.

The 80,000-sqm site will focus on R&D, production, logistics, sales and service. Its initial capacity will ramp to 15 million units per year, including some production of 3G phones, and will eventually double that to a maximum of 30 million units. Lenovo declined to detail its ramp-up schedule, but if the facility maxes out it would outstrip China's largest domestic maker of cellphones, Ningbo Bird. It would still fall short of Nokia and Motorola, which have production bases in Beijing and Tianjin.

Lenovo's mobile phone division is one of its fastest growing businesses, the company said. Mostly known for its PCs, Lenovo now also claims 7 percent of the Chinese marketthe world's largest cellular marketafter Nokia, Motorola and Samsung.

The company hopes to boost its share to 10 percent by early next year, which would still leave it just shy of breaking into the top three. According to Sino-MR, a Chinese market researcher, Nokia has 34 percent of the market, with Motorola at 22 percent and Samsung at between 12 and 13 percent.

Zhijun Liu, general manager of Lenovo Mobile, said Lenovo will look to make gains by competing with international brands in the low-end market, but won't set foot in the ultra-low cost handsets market, where prices range from $25 to $62.

The Xiamen government built the facilities for Lenovo in exchange for rent and tax revenue. A government official declined to say how much it invested. Lenovo Mobile is a joint venture company founded in 2002 by Lenovo Group and Xiamen Overseas Chinese Electronic Co. Ltd. It has R&D centers in Beijing, Shanghai and Xiamen.

- Cai Yan
EE Times

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