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China’s Honor Stages India return with local manufacturing plans in early 2024

China’s Honor Stages India return with local manufacturing plans in early 2024

BENGALURU, Aug 21 (Reuters) – Honor, the prominent Chinese smartphone brand, is set to make a triumphant return to the Indian market after a strategic retreat last year. This resurgence is orchestrated through a licensing agreement with a local enterprise, signaling a fresh beginning for the brand on Indian soil. In a bid to solidify its presence, Honor is charting a course towards domestic manufacturing, aiming to kickstart operations by early next year, as revealed by the brand’s country head in an exclusive interview with Reuters.

In the not-so-distant past, Honor had taken a step back from the Indian market due to constraints such as limited marketing funds and portfolio management challenges. The brand’s journey in India underwent a significant shift in 2020 when it was compelled to detach from its parent company, Huawei Technologies. This detachment prompted a profound strategic reassessment, as pointed out by Neil Shah, Vice President at Counterpoint Research.

The resurrection of Honor’s market presence is propelled by a strategic licensing arrangement forged with a newly established company named Honor Tech, headquartered in Gurugram. While specific financial details remain undisclosed, the agreement hinges on technology and hardware transfer at an agreed-upon cost. Honor Tech will spearhead the launch of three variants of Honor smartphones in India, with the anticipated introduction of the mid-range Number series by September.

Honor Tech stands out as a locally-owned enterprise that will undertake the entire spectrum of operations related to Honor-branded smartphones in India, encompassing manufacturing, sales, and service. The ambition is palpable, as CEO Madhav Sheth envisions a future where all smartphones are ultimately manufactured within India. This shift towards domestic production aligns with the broader trend of fostering indigenous manufacturing and aligning with the “Make in India” initiative.

Sheth, a seasoned industry executive and a former key figure at rival company Realme, acknowledges the hurdles posed by Indian government scrutiny in the past. The skepticism surrounding Chinese brands’ accountability in India has been a pivotal challenge. However, Honor Tech seems poised to overcome these concerns and prove its commitment to the Indian market.

Recent times have witnessed a challenging landscape for Chinese businesses in India, with the government imposing bans on several apps and intensifying oversight on cross-border investments, all in a strategic move to safeguard national interests. In this context, Honor is preparing to enter the competitive arena, aiming to contend with established players like Samsung Electronics, which holds a substantial market share in India.

According to Counterpoint Research, Samsung leads the Indian market with a commanding nearly 20% share, followed by competitors such as Vivo, Xiaomi, Realme, and others. Honor Tech enters this arena with an ambitious goal – to capture a 5% share of India’s smartphone market by sales volume in the year 2024. Accompanying this aspiration is a revenue target of at least 100 billion rupees ($1.20 billion), indicative of the brand’s resolute commitment to carving out a substantial space in the Indian smartphone ecosystem.

As Honor stages its comeback with renewed vigor, the brand’s journey in India seems poised for a captivating chapter, marked by strategic partnerships, indigenous manufacturing, and a determined push to make its mark in the dynamic Indian smartphone market.

($1 = 83.0430 Indian rupees)


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