China-based vendor Lenovo and Japan-based NEC are likely to establish a joint venture in Japan to design, produce and sell smartphones in the global market, according to Taiwan-based supply chain makers.

NEC's handset business has suffered operating losses and Lenovo is unwilling to take over the business, the sources said. However, Lenovo is willing to cooperate with NEC based on the previous model in which both companies established a PC joint venture in Japan in 2011, the sources indicated.

NEC has strong R&D capabilities but lacks marketing channels to sell smartphones in overseas markets, the sources noted. For Lenovo, the cooperation will enable it to utilize NEC's R&D to complement its own, as well as enter Japan's smartphone market, the sources indicated. Lenovo ships 7-8 million smartphones a quarter while NEC ships four million units a year, the sources noted.

If the joint venture is established, Lenovo is expected to be responsible for production management and this will benefit Lenovo's existing Taiwan-based smartphone ODMs Compal Communications, Foxconn International Holdings, Wistron NeWeb and Qisda, the sources indicated. In addition, NEC's Taiwan-based ODM Arima Communications is likely to obtain orders from Lenovo, the sources said.

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved