Sony Ericsson in Major Chinese Move

The Swedish-Japanese mobile phone joint venture, Sony Ericsson, has announced that work has begun on its huge new factory in Beijing. At the same time the company said that it plans to make China its global manufacturing base.

Housed in a sprawling 18,500 square meters, Sony Ericsson's new premises will be responsible for manufacturing mobile handsets and assembling surface mounted circuit boards. According to the company, the expansion was necessary to meet growing market demand in China.

In a statement Gunilla Nordstrom, president of Sony Ericsson China, said the establishment of the new factory would contribute to the consolidation of China's status as the company's strategic development base.

The new factory is close to the manufacturer's other two Chinese sites: Beijing Se Putian Mobile Communications (BMC), which covers 25,610 square meters and produces mobile handsets, and Beijing Suohong Electronics (BSE), which covers 12,000 square meters and manufactures printed circuit boards.

In 2004 Sony Ericsson increased its holding in BMC to 51%. Last year it bought BSE out right. The new factory represents the latest step in the company's drive to make the Chinese capital its global manufacturing centre.

According to Sony Ericsson, BMC accounts for almost one third of the company's total global manufacturing volume and ships handsets to 119 countries and regions. Last year it is believed that BMC shipped almost 100 million handsets. Exports reached Yuan 22.14 billion (US$2.9 billion) in 2006, an 18% increase on the figure for 2005.