HO CHI MINH CITY -- Vingroup, Vietnam's largest company by value, will add a new brand to the country's crowded smartphone market on Friday produced at a local factory in partnership with Spanish device maker BQ.
The 30 million euro ($33.9 million) plant, already online, is in northeastern Vietnam and has a production capacity of 20,000 units per day. Vingroup aims for an initial annual capacity of 5 million units.
Vingroup's entry into the smartphone business represents part of the conglomerate's transformation into a technology group. Earlier this year, the group started automaker VinFast.
"Together with VinFast automobile, we expect Vsmart would promote the development of Vietnam's industry and bring Vietnamese brands to the world," Vingroup CEO Nguyen Viet Quang said.
The smartphone factory investment follows from a strategic partnership signed in July by BQ and VinSmart, a subsidiary of Vingroup. VinSmart acquired a 51% stake in BQ for an undisclosed amount of money.
The Vietnamese company has licensed BQ's models for sale under the new Vsmart brand, the Spanish company said in a blog post. The factory "will also begin to manufacture our own devices, in addition to Vsmart smartphones," BQ added.
BQ said it aims to enter Vietnam's fast-growing mobile phone market "with a European standard of quality and an international vision." Smartphone sales in Vietnam totaled 15 million units in 2017, almost double the volume in 2014.
Long a manufacturing base for top global smartphone vendor Samsung Electronics, Vietnam has emerged as market in its own right.
Local mobile phone brands include Mobiistar, Bphone, Asanzo and Viettel. But the market is dominated by global names, with Apple and Samsung leading the high end while low-price Chinese brands Oppo, Xiaomi, Huawei and Realme flood the midrange and low end.
Sources said the lineup hitting the local market Friday includes Vsmart Active 1 and Vsmart Active 1+ for the midrange segment, along with Vsmart Joy 1 and Vsmart Joy 1+ at the low end.
Vsmart products at the midrange and high end will be available on Vingroup retail channels nationwide, including VinMart+, VinPro and more than 200 outlets of a local mobile phone retail chain that Vingroup acquired this year.
BQ, one of five Spanish mobile phone producers, is strong in high-end and midrange models, an industry watcher said. The company posted revenue of 190 million euros in 2017, up 4.7%, having sold over 1 million of its Aquaris smartphones to end the year with a 10.3% share of Spain's market.
But BQ's share has shrunk since then, following the arrival of Xiaomi phones in November 2017, according to Telecompaper.
VinSmart also works with Qualcomm and Google to gain advanced technologies for smartphones.
In the next stage, the new factory plans to manufacture consumer electronics like smart home and smart TV products. Vingroup aims to develop electronic ecosystems and smart technology applying artificial intelligence through Vsmart, the CEO said.