Lenovo seeks top smartphone spot

Lenovo Group aims to challenge Samsung Electronics Co Ltd to become the No 1 smartphone vendor in the Chinese market this year, according to the company's chief executive officer.

"Innovation, strong distribution channels and effective operations have been the key factors that help Lenovo smartphones stand out," said Yang Yuanqing, chairman and chief executive officer, in an interview in Beijing on Friday.

Founded in Beijing's Zhongguancun technology hub in 1984, Lenovo has become a personal computer giant, competing with rivals including Hewlett-Packard Co and Dell Inc, and extending its reach to the smartphone market.

Lenovo was China's second-largest smartphone vendor by shipment in the third quarter last year, behind only Samsung, while Apple Inc fell two places to sixth in the same period, according to reports from the International Data Corporation.

Specific market share figures from local research firm Analysys International showed Lenovo's share rose to 14.2 percent in the third quarter, from 4.8 percent a year ago.

"Lenovo does not want to be the second player ... we want to be the best," Yang told China Daily, adding that he hopes the company will gain the top position in China's smartphone market this year.

"Lenovo has the confidence to outperform Samsung and Apple, at least in the Chinese market," he said.

Yang said Lenovo has long been dedicated to the mobile phone business. As early as 2002, it started research and development work on mobiles. It was the first company to offer smartphones and tablet computers in the Chinese mainland market, launching Le-Phone, a smartphone model, five years ago.

IDC analysts said Lenovo's rise is largely due to "aggressive ramping-up and improvements in channel partnerships".

Compared with Apple, which launches one smartphone model annually on average, Lenovo introduced 46 smartphone models, covering all price ranges, to the Chinese market in 2012.

It also invested 5 billion yuan ($793.5 million) in Wuhan, the capital of Hubei province, to build a manufacturing base with a production capacity of 30 million to 40 million smartphones a year. Yang said such factories will help the company maintain low stocks but with steady supplies.

Wang Ying, an analyst at Analysys International, said: "Lenovo possesses an obvious advantage over rivals in terms of sales channels."

While Samsung, the world's biggest smartphone manufacturer, relies heavily on electronics chain stores to sell products in China, Lenovo owns tens of thousands of outlets in the domestic market, reaching counties and villages.

Yang said Lenovo will expand its smartphone business overseas, starting in emerging markets. The company says it has already shipped smartphones to countries including India, Russia and Vietnam.

The IDC reported that China's smartphone shipments reached a record high, passing 60 million in the third quarter of 2012, more than three times the country's PC shipments.

Wong Teck-zhung, senior market analyst at IDC, said: "Chinese vendors such as Lenovo and ZTE made it to the APEJ (Asia-Pacific excluding Japan) top five vendors on strong performance in their home market, showing it is not impossible for Chinese vendors to surpass international vendors."