China's tech behemoth BBK Electronics has decided to make handset makers OnePlus, Oppo and Realme separate entities in India, in an attempt to de-risk its India business, says a report by Economic Times. The three smartphone OEMs will have sales accounted for in their own books. Previously, Oppo Mobiles India was handling the distribution and sales of all three handset makers.
The aim behind BBK Eletronics' move to separate the three businesses is to de-risk from the current and future government actions, the report added, citing three senior industry executives. Oppo and Vivo have been under the scanner of Indian tax authorities since last year over alleged tax issues. Vivo and iQoo are also owned by BBK Electronics through a separate entity Vivo Mobile India.
Handset makers OnePlus and Realme are likely to join hands with local Indian contract manufacturers soon.
According to data by market intelligence firm Counterpoint data, India's smartphone market is dominated by Chinese players, with BBK Electronics' owned Vivo, Oppo and Realme along with Xiaomi accounting for almost half of all sales. South Korean tech giant Samsung has a 20 per cent share.
Reports in May said Oppo is pulling the plug on its chipset design subsidiary amid falling shipments and an uncertain semiconductor market. Oppo's chip design unit, called Zeku is being shut down amid the company's efforts to cut down costs and resize, said a report by TechCrunch. The handset maker announced the move in a brief statement, calling it a "difficult decision" and blaming "uncertainties in the global economy and smartphone market", said a report by the South China Morning Post.
Oppo's smartphone shipments dropped 8 per cent in the first quarter (Q1) of 2023, according to market research firm Canalys. Other than Apple, all five of the top phone makers saw a decline in shipments. Also, the global semiconductor revenue is projected to decline 11.2 per cent to reach $532 billion in 2023, and the short-term outlook for the semiconductor market has deteriorated further.
Earlier in March, reports said smartphone brand Vivo will merge iQoo into its main business, in a bid to reduce costs. Vivo has reportedly said the merger of both brands into one is also to "boost efficiency". It is likely that the brand will be laying off some of its staff during the merger of the two handset makers.