Nokia's handset sales in China boom 77 percent

A model shows off a creation by a Chinese designer, inspired by Nokia, the world's leading mobile phone maker, at the annual China Fashion Week in Beijing on Tuesday.

Nokia Oyj, the world's largest maker of mobile phones, said the company's handset sales in the China region rose 77 percent in the first nine months compared with a year earlier on increasing demand.

The company sold 23 million mobile phones in China, Hong Kong and Taiwan in the nine months ended September, Chief Executive Officer Jorma Ollila said at a seminar yesterday in Beijing.

There are no comparative figures for sales in China because they were included in the Asia Pacific region's figures until last year.

Ollila, 55, said the Espoo, Finland-based company has invested about US$2.2 billion in China, which has 383 million subscribers and is the world's largest cell-phone market by users.

Nokia has plants in Beijing, Dongguan and Suzhou, and employs more than 6,000 people in the China region, compared with five when it started operating in the nation in 1985.

"Nokia has built a thorough business in China over the past 20 years and has grown together with China's mobile industry," Ollila said. "We believe that by 2010 China will have added another 250 million subscribers."

Nokia in China * The company has invested about US$2.2 billion in the country * It employs more than 6,000 people in the China region, with plants in Beijing, Dongguan and Suzhou * Its sales in the China region rose to US$3.3 billion in the first nine months of the year * It had a 12 percent market share in China last year

Sales in the China region rose to US$3.3 billion in the first nine months and exports from the area were US$2.3 billion, Ollila said.

Nokia had a 12 percent market share in China last year, while Schaumburg, Illinois-based Motorola Inc. had 11 percent, Tokyo-based researcher Fuji-Keizai Co said on Oct. 20. China's Ningbo Bird Co, based in the eastern port city of Ningbo, fell to third place with 10 percent.

"Nokia's growth has come at the expense of local Chinese handset makers," said Edward Yu, chief executive of Analysis International, a technology market researcher. "Nokia's gain in particular comes from its introduction of new models selling for less than 1,000 yuan (US$124). Consumers would rather buy from Nokia if the prices of handsets are the same."

The company is expecting China's government to officially grant licenses for the so-called third-generation, or 3G, handset standard next year and Nokia has up to 10 new 3G models it plans to introduce to the market, said Colin Giles, senior vice president of customer and market operations for Nokia China.

"We want to produce and introduce leading-edge technology into the China market," he said.