Boat, which has been manufacturing a majority of its devices in India through a joint venture with Dixon, designs its products locally and has already attained 20-25% local value addition.
Speaking to ET, Boat’s co-founder Sameer Mehta said, “We definitely need some engineering support because design for manufacturing is a very big aspect and currently, we don’t have the capability here, at least Boat doesn’t have that capability and for that, we need some Chinese help.”
But, he said, the components are not necessarily only coming from China. “Component supply chain, if you look at it, there are fabs like TSMC that are sitting outside of China, which also make all these products. So, it depends on what components you are using, then where you are going to source them from. So, it is not only 100% Chinese dependency,” Mehta added.
In the wake of geopolitical issues and tensions between India-China relations, the electronics industry has been facing some constraints in getting equipment supplies and skilled personnel. Since China is an integral part of the electronics manufacturing ecosystem, there has to be some collaboration with Chinese suppliers.
“We need them (Chinese) to come here to India. But I think, at the end of the day, you have got to make do with what best you’ve got, and any adversity is essentially an opportunity to reinvent yourself, to reinvent a new way of doing it. We see it as an opportunity to become self-reliant,” he said.Boat has been spending around 35% of its annual operational expenditure (Opex) on research and development (R&D) to design the products and develop an ecosystem. The company has partnered with the Centre of Excellence (CoE), set up by the Ministry of Electronics and IT (Meity) along with the Uttar Pradesh government and India Cellular and Electronics Association (ICEA) to support Indian companies in building a design ecosystem in India.“Why should we be buying designs out of China, why can’t we create the designs and submit them to the CoE, so that the entire electronics manufacturers can use them,” he quipped. The company has already designed and developed an indigenous neckband IP and is working on a speaker design.
Asked about the manufacturing capabilities, Mehta said that around 60% of the manufacturing is done in-house by its JV partner Dixon and some work is done by other players. “Some of the high complex products like a hybrid AMC etc are imported from China or Vietnam depending on where our supplier base is. But besides that, most of the things we are able to make here,” he said.
Asked about local value addition in Boat products, Mehta said currently it stands at 20-25% but this is going to increase soon.
“We are planning to bring our PCBA localization into India. We’re also thinking about bringing the battery localization and there are companies in India who have started doing it. If you’re able to do these two things, I think we should be able to reach upwards of 40-45% in terms of localization,” he added.
