LENOVO BANKING ON UPMARKET PUSH
Firm aims to tighten mobile branding and shift focus to pricier models under Moto brand
AFTER a bruising fall from its spot as the world’s third-largest mobile phone maker following its acquisition of Motorola three years ago, China’s Lenovo Group Ltd is counting on a push upmarket to stop the bleeding in its smartphone business.
While the company, which vies with HP as the world’s largest personal computer (PC) maker, returned to profit in the year to March, losses in its smartphone business worsened as marketing expenses for new products and key component costs increased.
The group’s problems started after it acquired Motorola Mobility from Google for US$2.9 billion (RM12.3 billion) in 2014 but struggled to integrate the assets.
That, combined with fierce competition from lower-end manufacturers in its home base of China such as Xiaomi and Oppo, an editorial yesterday.
“The result is a sea of madness.”
The Hong Kong Monetary Authority (HKMA) has been tightening rules for lenders, including restricting levels of lending to developers, as it tries to limit financial risks and take some of the heat out of the market.
The Centaline Property CentaCity Leading Index of existing homes has advanced 23 per cent saw its global position fall to eighth last year.
A recently announced reorganisation of its China business aimed at sharpening the PC brand’s consumer focus comes amid an ongoing effort to tighten its mobile branding and shift the focus to pricier models under its Moto brand.
“Our strategy is to prioritise mature markets ... which need brands and innovative products, whereas emerging markets need efficiency,” said chairman Yang Yuanqing of Lenovo’s mobile business at a press conference in Hong Kong on Thursday.
“So we will have two teams catering to the two kinds of markets with different product lines.”
Lenovo faces its toughest battle in its home base of China, where it has slipped out of the top 10 smartphone vendors.
Shipments domestically declined 80 per cent year-on-year or 55 per cent quarter-on-quarter in the first quarter of this year, according to data from Canalys. Reuters in the past year, setting new price records week after week.
At a Legislative Council meeting yesterday, HKMA chief executive Norman Chan said levels of demand were reminiscent of 20 years ago — before Hong Kong suffered a property bust — and he expressed concern that people with limited financial resources were buying just because they thought prices would only keep going up. Bloomberg
Buyers at the first sale day of Ocean Pride, a development by Cheung Kong Holdings, in Hong Kong on Friday.
Lenovo faces toughest battle in China, where it has slipped out of the top 10 smartphone vendors.