HTC Might Outsource Smartphone Production

Posted by at 8:47 am on October 23, 2013

HTC is considering whether or not to have other companies build its phones.

HTC has spoken with several companies that run production facilities, including Hon Hai Precision and Wistron, about taking over some of HTC’s manufacturing needs, according to the Wall Street Journal. Citing sources familiar with HTC’s plans, the Journal says the company is looking for ways to save money as its cash flow weakens. HTC has always manufactured its own hardware because it owns various factories in Taiwan and China. Most of HTC’s competitors, save for Samsung, outsource device manufacturing to other companies. The Journal also said that HTC might sell some of its plants. In a separate report, Reuters said that HTC has already idled several of its manufacturing facilities.

Reuters reporters who visited an HTC facility outside of Taipei saw that it was shuttered. The facility in question handles about 20% of HTC’s manufacturing capacity. When asked about the shuttered plant, HTC Chief Marketing Officer Ben Ho said, “Like any manufacturer, we do volume planning to optimize our lines, our manufacturing, and production facilities. Whether we are operating those facilities depends on market demand and our own expectations. When you have less demand you work with less facilities to optimize your costs. When you have demand, or bigger growth, you definitely have to activate all these facilities.” Ho also said the company has no plans to sell its manufacturing plants.

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