Xiaomi forms Africa-focused business unit as overseas sales rise

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(Image credit: Xiaomi)

Chinese smartphone maker Xiaomi is looking to expand its presence in Africa amid increased domestic competition and slowing in the Chinese smartphone market, Jiemian reports (in Chinese).

Xiaomi will set up a business unit for the African region to accelerate its expansion on the continent, the company said in an internal letter to its employees. Wang Lingming, vice president of the company, has been appointed head of the new unit and will report to senior vice president and global business head Wang Xiang.

The company has seen success in the overseas market, where it generated more than 40% of its revenue in the third quarter of 2018. It has also steadily expanded in India on the back of its affordable pricing, replacing Samsung as the top industry player in the second half of 2018.

The increased focus on Africa puts the company at odds with well-established rivals on the continent. Founded in Hong Kong in 2006, mobile phone manufacturer Transsion began operating in Africa as early as 2008 and has dominated the regional market since 2014. The company owns three sub-brands—Tecno, Itel and Infinix.

Transsion accounted for nearly 60% of the continent’s feature phone market and 35% of smartphone shipments in Africa during the third quarter of 2018, according to research firm the International Data Corporation (IDC). Samsung and Huawei followed, making up 22% and 10% respectively.

Wang Lingming was previously vice president of Chinese feature phone brand K-Touch, which is also focused on Africa.

The move follows Xiaomi’s restructuring plan from December 2018, when a new business group was established to increase the company’s focus on the domestic market. Xiaomi lagged behind its Chinese rivals in the third quarter of 2018, holding 12% of market share. It trails Vivo, Oppo, Huawei, and Huawei sub-brand Honor. The company’s sales increased by only 1% year-on-year during the same period.