Huawei inks distribution deal with Micromax while Honor reportedly scales down its Indian operations
Huawei has been in the news lately, for both good and bad reasons. Devices like the Huawei P30 Pro have been widely praised for their innovative and impressive camera setup, with some third-party applications for these phones even allowing users to literally see in the dark. Huawei’s efforts towards its Ark Compiler have also not gone unnoticed. On the other hand, the Chinese technology giant is still reeling under the effects of the US Trade Ban, even though promises to lift the same were made. Now, Huawei has announced that it has signed a distribution deal with Micromax in India, while other reports suggest that Huawei’s Honor sub-brand is scaling down its Indian operations.
In order to strengthen its presence in the offline retail segment in India, Huawei has entered into a distribution partnership with Indian smartphone company, Micromax. In separate statements made to IANS and PTI, Rishi Kishor Gupta, Vice President of Consumer Business Group of Huawei India, says the following:
We have partnered with Micromax to launch our smartphones at multi brand outlets in India.
We are already present in 200 sales points through our existing partnerships. The tie-up with Micromax will give us access to a strong network of 1.25 lakh outlets across 40,000 pin codes.
Deepti Mehra, Head of Marketing at Micromax Informatics, expanded on the deal as below:
In Micromax brand stores, Micromax phones will be available. But as far as the distribution and retail network that we have, Huawei will be capitalising on that. There will be no co-branding. Micromax will continue separately when it comes to launching of own phones. There is no conflict of interest because Micromax addresses to the mass segment and Huawei the premium category. The company plans to launch new devices in the coming months and there are no plans to launch premium devices in the short-term from the Micromax stable.
From our understanding, Huawei’s deal with Micromax will focus primarily on the Chinese company taking advantage of Micromax’s distribution network in India. This deal is not to be construed as Micromax taking over the responsibility of selling Huawei devices in India as statements made by the executives do not point in this direction at all. Instead, the deal will allow Huawei smartphones to be placed alongside Micromax handsets in multi-brand outlets. This will seemingly give Huawei access to an established offline retail network that Micromax already utilizes for its own handsets.
Huawei’s push towards offline presence ties in with reports that its online-only sub-brand Honor has begun laying off employees in India. According to a report from Economic Times citing sources that wished to remain anonymous, Honor is scaling down its Indian operations and asking employees to resign across functions in a phased manner. The functions affected by the downsizing include retail, marketing, research and development, design and even after-sales. The downsizing is a result of drop in sales, which is concerning as Honor drives a bulk of the volume for Huawei’s smartphone sales. The report further mentions that there already was a freeze on hiring since the past three months, which predates Huawei’s US trade ban that was initiated on May 15, 2019.
Source 2: Economic Times