A day after the Redmi K20 series debuted in India, Xiaomi India managing director Manu Kumar Jain shared an open letter to all Mi fans, addressing two crucial questions — Why are these devices more expensive than previous generation chipset device? and Why is there a difference between India and China pricing?
Xiaomi India has been in India for five years now and the best of its smartphones have been priced below the Rs 25,000 mark. However, this time, the Redmi K20 Pro is priced starting Rs 27,999, and this stirred up a lot of questions.
What did Manu Kumar Jain have to say about the Redmi K20 pricing?
Talking about why the Redmi K20 series cost more than the previous generation chipset devices, Jain recalls the specifications and features of the smartphones and says that both devices are much faster than the previous generation phones — Redmi K20 Pro is 45 percent faster, and the Redmi K20 is 40 percent faster.
He also points out that “the latest technology gets cheaper with time”, and Xiaomi could have waited another six months to release the phone in order to cut down cost, however, that “would’ve gone against our philosophy”.
As for the difference in India and China’s pricing of the smartphones, Jain says the difference is only of three percent. Jain points out three things that caused this three percent difference in the pricing.
First, the top variant of Redmi K20 Pro is China comes with 6 GB RAM and 64 GB storage, whereas in India, we get 6 GB RAM and 128 GB storage.
Second, he says that due to Redmi K20 and Redmi K20 Pro being the “most complicated smartphones to have been manufactured in India”, Xiaomi had to upgrade the technology in its manufacturing plant. He claims that most smartphone manufacturers do not make complex flagship devices in India, which increases the priced of the phones by 20 to 40 percent in the country.
Xiaomi, on the other hand, he says, developed the flagship phone in India, with “65 percent of the value of the phone being locally sourced”. The remaining 35 percent apparently had to be imported due to higher cost and taxed for complicated parts.
Third, Jain says that the price difference could have been met by Xiaomi replacing the glass body with plastic, but it chose not to. The Redmi K20 series reportedly has less than five percent net profit.
In China, Redmi K20 is priced starting CNY 1,999 (Rs 20,000 approx), the Redmi K20 Pro starts at a price of CNY 2,499 (approx. Rs 25,000) and goes up to CNY 2,999 (approx Rs 30,000) for the top-end variant.