Sony India Private Ltd is the latest to be snared by the recession in the domestic entertainment electronics market. Managing director Teruo Ishii today said that recession has pushed down the company's growth from 10-20 per cent, two years back, to just around 5 per cent last year.
Against a production capacity of three lakh colour television sets and two lakh mini audio systems at their Dharuhera plant in Haryana, the company is producing only two lakh television sets and one lakh audio sets.
"But we are confident of bugging the recession with a strong line up of new products this Diwali," Ishii said.
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Sony is also planning to import certain high-end products such as play stations, laptops and cellular phones from their manufacturing facilities in Japan and the Far East in the coming months, taking advantage of the liberalised import policy.
"Indian consumers are willing to pay for high value-added products now. Through import of some of our international products, we will be able to further improve our bottomline," Ishii said.
The chief executive was confident that the fully-owned Indian subsidiary will be able to close the current fiscal with a turnover exceeding Rs 700 crore against an actual Rs 622 crore clocked in 2000-2001.
"Import of completely-built-up products now account for 20 per cent of the turnover of India operations. This share will keep increasing steadily in the coming years," he said
Ishii indicated aggressive marketing in some high-value items such as cellular phones in the Indian market. Two years ago, Sony was marketing cellular phones in India, but it was withdrawn following fierce competition from rivals like Motorola, Nokia and Erricson.
"Now our Japanese principal has joined hands with Erricson to put up a 50:50 joint venture in the United Kingdom. The details are being worked out and will be announced soon by our headquarters in Japan. The UK venture will introduce new versions of GSM handsets," Ishii said.
He said the cellphone industry was working towards a single standard and unified system worldwide.
While India, Europe, China and parts of Asia used the GSM technology, the US, Japan, Korea and some other countries were utilising the CDMA technology. "This is creating problems of compatibility and we have to move towards a single standard," he said.
Ishii said that Korean majors such as Samsung and LG dominate the local television market. The Japanese manufacturers were late entrants into the Indian market compared to the Koreans. They also enjoyed price advantage.
But they were not very much known in the European and American markets, while Sony remained an international brand.
"We do not want to enter into a price war.. We are in the higher segment of the market and will remain so", he said.