Chinese handset vendors go abroad

By Linda Sui (China Daily)
Updated: 2006-12-04 09:20

TCL surpassed Bird as the leading player in the overseas handset market in terms of export volume last year.

BDA believes Huawei and ZTE will both exceed Bird's volume this year, mainly due to their strong performance in overseas operator markets.

Amid the increasing competition, Bird must strengthen its operator channels and enrich its product lineup by launching high-end and 3G models in order to improve profit margins and strengthen financial performance for the company, which last quarter saw results in the red.

Leveraging Alcatel's overseas sales presence, TCL jumped to the top position in 2005, with a shipment volume of 6.4 million units. BDA expects the company will continue to bear fruit from its strong overseas presence, with an export volume predicted to reach 9.5 million units this year.

The overseas market became an essential component of company sales, making up over 85 per cent of total shipments over the first three quarters this year.

Asia-Pacific, Europe, the Middle East, Africa as well as Latin America, are TCL's main export markets, which like Bird, also focus on mid- and low-end GSM/GPRS phones. The company uses ODMs and its own branded exports as its two major methods of overseas sales.
In terms of ODM, TCL entered the Russian market using local brands, and leverages Alcatel's good brand awareness in Europe and Latin America for its own branded exports.

It provides Alcatel branded handsets to Vodafone, Telefonica, Orange and some distributors in the markets listed above.

However, similar to Bird, the company also lags behind in high-end phones and 3G exports.
According to BDA interviews, the company integrated its global R&D resources into subsidiary JRD Communication Inc early this year, and is currently developing feature phones and 3G products to be launched abroad next year.

3G handset suppliers

ZTE, Huawei and Amoi have started providing customized 3G handsets to foreign operators. BDA anticipates the total 3G handset export volume will reach 4 million units by year-end, up from 1.1 million last year, with Huawei and ZTE as the main contributors.

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