Toshiba plans expansion of business in China
( 2001-12-05 10:36 ) (1 )

Japanese electric giant Toshiba will move more of its business to China, whilst Japan's domestic market continues to slow down. A joint venture mobile phone based in Nanjing, capital of East China's Jiangsu Province, will begin operation early next year, Toshiba told China Daily.

The joint venture factory will be established by Toshiba and Nanjing PTIC (or Nanjing Putian), said Katsufumi Nomura, a spokesman for the Toshiba Corp.

The factory, now in the final construction phase, aims to produce 500,000 units of mobile phones for the Chinese market in 2002, said Nomura.

The output will double to 1 million in 2003 with adjustments being made according to the market demand, he said.

The joint venture is a result of co-operation with Nanjing PTIC, a local subsidiary of China PTIC Group, the country's biggest telecom equipment vendor.

China PTIC Group was ranked first for the year 2000 in the revenue list of the country's top 100 information technology companies, according to the industry regulator, Ministry of Information Industry (MII).

The spokesman refused to disclose how much Toshiba and its Chinese partner had invested in the joint venture and said construction is not yet finished. The factory will produce mobile phones for CDMA (code division multiple access) networks, which will soon be kicked off by China Unicom early next year.

The coming CDMA communications age in China should provide good opportunities for Toshiba to expand its business in China, according to the spokesman.

With the launch of the country's first CDMA network, Toshiba will enter the market when it has the right opportunity.

The Chinese Government recently issued 19 licenses to mobile phone makers and issued just one to a foreign company, the US-based Motorola. Yet only a few of the 18 domestic companies have the ability to produce CDMA handphones.

This is a government policy to encourage foreign companies to set up joint ventures with domestic firms and to transfer technologies to local partners, according to officials of the MII.

Toshiba is one of the groups of foreign companies, along with Samsung, Hitachi, Kyocera and Sony, which have entered the market through opportunities that have arisen.

Toshiba has set up 23 joint venture companies in China with accumulated investment of 6 billion yuan (US$723 million). Its total revenue in China reached 250 billion yuan (US$30 billion) in 2000 and will be over 400 billion yuan (US$48 billion) by 2003, according to the company.