Taiwanese smartphone maker HTC seems to have given up on the Indian market. It is likely because of the cut-throat competition that the company received from the Chinese smartphone-makers that have taken the Indian smartphone industry by storm in recent years. According to a report by The Economic Times, this decision comes right after the top management for the company including India head Faisal Siddiqui, head of sales Vijay Balachandran, and the HTC India product head R Nayyar resigned. The report went on to add that the company has asked its team of about 70-80 members to leave except a few members including Rajeev Tayal, the chief financial officer.
The reason for keeping a small part of the team is because HTC is not completely dissolving its operations in India. The report added that it is planning to focus on selling “virtual reality devices online” where Taiwan office will “completely” control the operations in India. When talking about the smartphone business, the company “also snapped all distribution agreements in the country” just about a year after it stopped locally manufacturing its devices. The company will now run “like an extremely small business” in India.
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One thing to note here is that the company may think about entering the Indian market again as “an online exclusive brand” but it will only be possible after the company manages “to turnaround sales globally” as it is struggling in a number of markets. Though, for the time being, the company “is quitting” the market. HTC issued a statement as part of the report adding that it “will continue to sell its smartphones in India” as the country serves as “an important market”. The company also added that it will continue investing “in the right segments” at “the right time”.
The company went on to add that the reduced workforce is aimed “to more appropriately reflect local and regional market conditions.” Though, as the report points out, the company may run in legal trouble as some of its distributors are planning to take a legal action against HTC India for “non-payment of dues” or lack of compensation for the stock that is already in the trade pipeline. The cures run in to “several crores.” The company added that it is “working with its channel partners to make sure that its customers are not affected by any disruption when it comes to the business or services.
This move is not surprising as the company currently holds “less than 1 percent” market share in the country along with a recent report where the sales for the company fell “by nearly 60 percent” in comparison to last year in the month of June and its decision to remove 1,500 people from its workforce.