Nokia, Motorola Lose China Market Share To Domestic Companies
Friday March 14, 12:20 am ET
BEIJING -(Dow Jones)- International mobile phone makers like Nokia Corp. and Motorola Inc. (NYSE:MOT - News) saw their share of the Chinese market - the world's largest - continue to decline last year due to increasing competition from domestic producers, official figures show.
In a recent report, the Ministry of Information Industry said the collective market share of China's domestic mobile phone makers jumped to 39% in 2002 from 22% in 2001. That came at the expense of foreign companies: Motorola's share dropped to 26% from 29%, while Nokia's fell to 18% from 22%.
"Domestic enterprises used the power of price to break the leading advantage of foreign brands, cutting prices to drive sales," the report said. It noted that 70% of mobile phone owners fall into the mid-price or low-price category of phones costing less than 2,500 yuan ($1=CNY8.28), where domestic makers are strongest.
The market share of Siemens AG (SI) also declined in 2002, to 4.7% from 9.7%, while that of Sony Ericsson - the joint venture between Telefon AB LM Ericsson and Sony Corp. - was 2.1%, compared to Ericsson's 6.5% in 2001.
The report didn't give market share figures for individual domestic firms, but noted that the two top companies were Ningbo Bird Co. and TCL Mobile, which is partly owned by TCL International Holdings Ltd. .
The ministry also didn't give a precise estimate for the size of China's domestic market, but said mobile phone sales totaled 130.2 million in 2002, of which exports accounted for 59.8 million, implying total domestic sales of 70.3 million.
China's domestic companies, while increasingly competitive in the local marketplace, are having limited success abroad. Domestic firms exported just 530,000 phones in 2002, the report said, less than 1% of the country's total.
biz.yahoo.com
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