Carphone Warehouse plan US expansion

Carphone Warehouse was linked to a move into North America today after newspaper reports said it planned to open a number of stores there.

The first site, in New York, will begin trading within weeks, with several more in major cities over the coming months, the Daily Telegraph said.

The UK mobile phone retailer, who operates several stores in Ireland, will open the outlets in partnership with BestBuy, the US electronics retailer.

Carphone chief executive Charles Dunstone is thought to view the tie-up with BestBuy as a low-cost way of examining the company's potential in a market which does not have any independent mobile phone retailers of size. Most consumers buy their phones direct from network operators.

Today’s reports suggested that the Carphone name would not be used for the venture.

Carphone Warehouse is already a sizeable force in the European market with more than 1,500 stores in ten countries. In April, it indicated it wanted another 250 outlets in the coming year, of which 75% would be outside the UK.

It has also been focusing on its TalkTalk broadband product after admitting its customer service provision had not kept up with demand.

In June, the company reported a 36% increase in pre-tax profits to £136.1m (€106.19m) and 29% growth in revenues to £3bn (€2.34bn) for the year to April 1.

The move into the US is seen as significant because, unlike many countries in western Europe, usage of mobile phones has not reached saturation point.

A source close to the venture told the Financial Times: “The US is a massive mobile market and very fast growing. And there is no equivalent there to Carphone, just loads and loads of distribution outlets tied to particular operators.”