Devices vendor Samsung is planning to set up a factory in West Java to manufacture mobile phones primarily for Indonesia.
Indonesia is one of the world’s fastest growing markets for smartphones and feature phones. Recently, BlackBerry Z3 was launched initially in Indonesia.
Samsung is planning an initial production capacity of 100K units per month, but will eventually increase to 900K.
In the second quarter, Samsung invested KRW 4.8 trillion as capital expenditure — KRW 3 trillion for semiconductors and KRW 700 billion for display.
Seeing sales of its flagship Galaxy models weaken in more established markets, Samsung is turning to markets with low smartphone penetration rates and higher disposable incomes like Indonesia.
Earlier, Samsung admitted that the smartphone sales declined due to increased competitions from mid to low end segments which resulted in higher marketing and promotion expenses to reduce inventories in sales channels.
Samsung shipped about 95 million units of phones in the second quarter of 2014 and the tablet sales were about 8 million.
The Korean electronics company is expecting both handsets and tablet in volume unit-wise to increase about 10 percent in third quarter quarter-on-quarter.
Samsung said the ratio between smartphone to feature phones will be 80-20 in the third quarter against 70-30 in the second quarter.
ASP of Samsung will dip in the third quarter from $230 in the second quarter because of greater mix in the mid-to low-end.
The device vendor aims to increase shipments by introducing new models while maintaining healthy channel inventory levels. It plans to launch a new Flash model in the large-screen category and a new premium model, along with new mid- to low-end models with advanced features and more competitive price.
editor@telecomlead.com
