AIMRA Plans To Sue Xiaomi For Prioritizing Online Sales In India

JAKARTA - Chinese mobile phone maker Xiaomi has denied accusations made by mobile phone retailers in India that it violated the agreement by entering into exclusive deals with online marketplaces.

Mobile phone retailers under the All India Mobile Retailers Association (AIMRA) have threatened to sue the Indian Competition Commission (CCI) against Xiaomi. They accuse the company of preferring online marketplaces over offline retailers.

“Xiaomi's claim of the highest sales in the last two months has made us all ponder from which channel such huge sales have been achieved. Was it done by exporters, aggregators or other channels as Mi partners across India had the least or no stock during that period," reads the letter addressed to Sunil Baby, Xiaomi's offline sales director.

Xiaomi has been leading the Indian mobile market for more than two years. According to a July 28 report by market research firm Counterpoint Research, the company and its subsidiary POCO own 28% of India's smartphone market today. In fact, four of the top five mobile phone brands in India are from China, with the exception of Samsung, which trails Xiaomi in second place.

Phone retailers have accused brands like Xiaomi of changing it quickly in favor of their own online stores or Amazon in the past as well. AIMRA had filed a demand for equality between online and offline channels in January 2020. They have also been very vocal on this issue over the years.

In response, a letter signed by Baby to AIMRA claimed the allegations were “factually untrue” and called it an “attempt to defame” the Chinese brand.

“Over the years, we have made huge investments in our Retail channel and with the love and support from Mi Fans and Partners we have provided tremendous growth for all of us. As per GFK, our offline retail market share has increased by 5% absolute increase since early 2021, which would not have been possible without increased supply and support and relentless trust from our partners in our brand," reads the letter from Xiaomi.

The company also says that it does not sell exclusively mobile phones online in India and does not differentiate in terms of pricing across online and retail channels. He also claimed that retail and online channels had been hit by supply constraints caused by the Covid-19 pandemic.

"We strongly disapprove of any false statements made by AIMRA," the company added. “We believe that associations like AIMRA and companies like us should work together to empower retail partners and grow their businesses, especially in such difficult times. In such situations, mutual trust and collaboration become very important ingredients for success,” he said.