Hon Hai inks deal with Indonesian handset distributor
By Ted Chen ,The China PostTAIPEI, Taiwan -- Hon Hai Precision Industry Co. has completed a deal with Erajaya, Indonesia's leading mobile phone distributor, with the contract manufacturer hired to supply over 50 million smartphones and feature handsets in the coming year.
October 1, 2013, 12:09 am TWN
According to reports, the 50-million-unit deal represents over one-fifth of Indonesia's annual demand for mobile phones, which is estimated at 250 million units.
In addition, Hon Hai is currently in negotiations with Polytron, a subsidiary of a leading Indonesian conglomerate, to help develop Indonesia's information and communication technology industries. According to reports, Hon Hai plans to assist in the establishment of a testing facility in hopes of bringing Indonesia's technical infrastructure closer to international standards. In addition, reports indicate that Polytron, a TV maker, may enlist the partnership of Hon Hai in its attempt to cross over to the smartphone market.
Reports also indicate that Hon Hai is actively seeking collaborative ventures with local manufacturers, trading companies, content providers, and local brands in hopes of increasing its share of the Indonesian market.
Hon Hai stated that with an estimated annual demand for 250 million handset units, Indonesia is a rapidly growing market, particularly given its current migration from 2G feature handsets to 3G-enabled smartphones.
Most notably, Hon Hai stated that despite numerous incentives offered by the Indonesian government, such the waiving of import tariffs and exclusive terms on industrial zones, the company will adopt a unique investment approach in the region designed to cater to local consumption patterns, rather than a conventional model of setting up export-oriented manufacturing plants. The company stated that it is seeking collaborative initiatives with local partners and plans to cooperate with the Indonesian government as the country restructures its industrial sector by facilitating the transferal of technical know-how. Hon Hai stated that it does not plan to bring its own brands into Indonesia, saying that branding is the domain of its local partners. The company stated that it can best serve its Indonesian partners by providing handset manufacturing services across a wide range of specifications.