Dell's Sriperumbudur plant goes on stream

CHENNAI, INDIA: The Sriperumbudur plant of Dell India Pvt Ltd has commenced commercial production. The plant will assemble 4,00,000 desktop computers initially but Dell’s five-year $30-m (Rs 120 crore) investment plan envisages gradual ramp-up of capacity to 2.5 million units.

The Rs 2,000-crore Dell India is a subsidiary of the $57-billion Dell Inc of the US. The Sriperumbudur plant, located in the SIPCOT Sriperumbudur hi-tech SEZ, was inaugurated by Kip Thompson, Vice-President, Worldwide Facilities. The first computer that rolled out of the conveyor belt was ceremoniously handed over to representatives of Dell’s leading corporate customer, Infosys.

In an interaction with presspersons, Dell officials said that local assembly of computers would lead to a “meaningful reduction” in costs, but declined to give any idea of the savings.

The assembly unit is located on a 50-acre land in the SEZ, but another 100-acre piece of land has been earmarked for Dell’s vendors to set up shop.

Dell India officials said that last year the company’s sales went up by 76 per cent by volume (to about 300,000 units) and 56 per cent by value. The company has been selling imported computers in India.

Globally, Dell has followed a strategy of dealing with end-customers directly. Customers book orders online with their specifications and these orders land in a Dell’s computer at the head of the assembly line. Computers are produced accordingly, and custom-made computers are supplied to customers.

However, in recent times, Dell has announced that it would also enter into tie-ups with large retail chains to market its computers.

In India, while Dell would also follow the online booking strategy, it is considering various “indirect strategy” options too, officials said.

In the US, Dell has a ‘recycle programme’, under which it buys used computers of any make. Asked if the scheme would be made available to Indian customers, Rajan Anandan, Vice-President and General Manager, Dell India, said that the company had indeed entered into tie-ups with two partners for operating the scheme. He declined to give the names of the partners.