Motorola becomes the latest manufacturing giant to move operations to India

Glen White
- Lean - Apr 30, 2015

Motorola Mobility, maker of Moto E and Moto G smartphones, is evaluating local production in India as part of its long-term plans to make the country one of its largest market globally.

"We expect to soon take a call on the possibilities of India manufacturing, considering we are significantly growing sales in India and the smartphone market here holds enormous potential," said Marcus Frost, Motorola's global senior marketing director for Europe, Middle East, Africa and Asia Pacific.

The firm would look at both company-owned and third-party manufacturing and is closely studying the Make in India policy of the Narendra Modi government.

With this Motorola joins a growing list of global smartphone makers, including Sony, Xiaomi and Gionee, considering local manufacturing in India, drawn by the 'Make in India' incentives. These firms are expected to firm up their plans this calendar year.

Motorola had a plant in Chennai, which it had shut down in 2013 as part of a global cost-reduction programme by its then parent Google.

The assets are still lying idle and, according to two senior industry officials, it could be revived as the first step for local manufacturing.

Frost, however, refused to comment on such a possibility.

Subsequent to Lenovo's acquisition of the Motorola business last year, the company has revived its plans to return to India in full force. "Lenovo is our parent, but Motorola is working independently making its own decisions. All business decisions, including possibilities of manufacturing in India, are made independently by our global team," Frost said, adding there are no plans to integrate sales and marketing operations with the parent firm in India.

At present, Motorola manufactures its smartphones in China and in Latin America such as Brazil. It, however, has a global software R&D facility in Bengaluru.

India and China are the only markets where both Lenovo and Motorola brands are sold together, while globally the two brands are segregated marketwise.

Motorola, which currently sells its smartphones only through Flipkart in India, sold some three million units here between February to December last year, with Moto G and Moto E models accounting for a bulk of it. Motorola currently has more than 3% share of the Indian smartphone market, dominated by Samsung and Micromax.

Frost said Motorola will continue its exclusive sales association with Flipkart, even though it is aware that the country has a sizeable brick-and-mortar sales network and other e-commerce firms are increasing business.

Some of its rivals, led by Xiaomi, have used 'flash sales' model on e-commerce portals to great effect to push sales in India, but Frost said Motorola will not try that strategy. "We will never go for the flash sales model on e-commerce, since we want our products to be always available for the consumers whenever they want it," he said.

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