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hina-based computer giant Lenovo has commenced local manufacture of its smartphones in Serang, Banten, aiming to cut the supply chain and illustrate the company'€™s commitment to complying with the local content requirement.

The factory, a joint cooperation between local subsidiary PT Lenovo Indonesia and Serang-based electronics component manufacturer PT Tridharma Kencana (TDK), started its operations last month, reporting a production capacity of 75,000 to 150,000 cell phones per month.

The factory produces Lenovo A6010 and A2010 series, with 20 percent local content.

Lenovo Indonesia smartphone division country head Adrie R Suhadi said Wednesday that, according to the cooperation terms, TDK would provide workers and a plant site while Lenovo Indonesia would bring in experts, quality controllers and machines from China in order to enable the transfer of knowledge and technology to locals.

He declined to disclose the amount of investment made or other details.

'€œLenovo has an interest in the transfer of knowledge as, currently, Indonesia doesn'€™t have any expertise in smartphone manufacturing,'€ he said on the sidelines of the announcement in Central Jakarta.

The announcement was attended by such members of government as Communications and Information Minister Rudiantara, Trade Minister Thomas Trikasih Lembong and Industry Minister Saleh Husin.

Currently, the 20 percent local content is being calculated from the assembling process that uses Indonesian workers and machines, the plant'€™s warehouse and tax payment to the government and so forth because the cell phone components are still imported, said Adrie. The company is currently considering the ways in which it can raise the local content, to reach a 30 percent local content requirement (TKDN) by 2017.

The government plans to apply a rule demanding all 4G smartphone manufacturers use a minimum of 30 percent local content in 2017, as part of government efforts to promote the country'€™s growing cell phone manufacturing sector.

Adrie said that local manufacturing was the company'€™s commitment to the proposed regulation.

'€œWe also want to deliver our products'€™ latest technologies to the Indonesian customer faster,'€ he said, expressing hope that a shorter supply chain allowed his products to reach the markets faster thus boosting brand growth. Currently, most Lenovo'€™s gadgets are imported from China.

Having entered the Indonesian market in 2005, Lenovo has now topped the country'€™s 4G smartphone market with a share of 19.2 percent and 27.4 percent in online sales, according to data from the International Data Corporation (IDC) Asia Pacific Quarterly Mobile Phone Tracker, in this year'€™s second quarter.

Chen Xudong, MBG Group senior vice president of mobile business and Lenovo and Motorola mobility operating board, said that the strategic market led his firm to choose Indonesia to be among the first few countries outside China, besides Japan and Brazil, to produce Lenovo smartphones locally.

'€œOur vision for the next three years is to further invest in Indonesia,'€ he said.

Thomas expressed his gratitude to the firm for investing and manufacturing in Indonesia.

'€œLenovo is a perfect example that investments are often started by imports, to some extent, that drives the companies to then decide it will be economically sensible to source locally,'€ he said, adding that the government would continue its support and alignments with businesspeople who are committed to investing in the country.