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Mobile phone manufacturers cut production   2012-07-16 - VNS

This has been a tough year for Vietnamese mobile phone brands, with many having to suspend production or even close down, unable to compete with their international rivals and troubled by the continuing economic slump.

Nguyen Van Toan, head of marketing at Hi-Mobile, one of the few surviving Vietnamese companies selling mobile phones, said: "As far as I know, many … have closed because of a downturn in sales.

"The economic recession has continued, so customers continue to tighten their belt. This has had a strong impact on the market."

Vo Le Tam Thanh, senior market analyst for client devices research at IDC Viet Nam, said a number of local and Chinese vendors had exited the market and his company expected more to leave in 2012 after struggling to survive in the current economic situation.

IDC said the top three brands in the first quarter were Nokia, Samsung and LG.

Overall mobile sales were down 15 per cent from the previous quarter, it said.

Dinh Anh Huan, marketing director of distributor Thegioididong.com, said Vietnamese mobile phone brands were in their current plight because they could not compete with foreign makes like Nokia and Samsung.

In the past they thrived because they dominated the low-price segment, but this advantage vanished after foreign companies also entered this segment, he said.

Toan told Viet Nam News that in reality none of the Vietnamese brands were made in the country, but were manufactured on contract in China.

Huan thought the only way for them to survive now was by producing cheap smart phones.

Other experts, however, dismissed this possibility saying most foreign companies had also entered that segment now.

HTC, for instance, cut the prices of some of its smart phones and saw exports to Viet Nam in the first five months increase by 400 per cent year-on-year.

"The market is now fiercely competitive. To catch up and compete with foreign companies, Vietnamese mobile phone companies have to improve both the quality and design of their products," Nguyen Lam, a senior IDC Viet Nam executive, said.



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