Business

Apple expands iPhone production in India in shift away from China

New Delhi has been working to lure companies seeking to diversify supply chains

New iPhone 14 models on display at an Apple event on the campus of Apple’s headquarters in California, US. Photograph: Jeff Chiu/AP

John Reed
Mon Sep 26 2022 - 20:11

Apple has begun producing its iPhone 14 model in southern India less than a month after it was launched as the company works to diversify its supply chains out of China and expand production in India.

“We’re excited to be manufacturing iPhone 14 in India,” the company said in a statement on Monday. Apple’s Taiwanese contract manufacturers already assemble some of the company’s existing models in India.

Apple, which makes most of its iPhones in China, has been shifting some of its production outside the country as geopolitical tension rises between Washington and Beijing. China’s harsh pandemic policies with sweeping lockdowns have also disrupted business.

The increased production in India is a win for prime minister Narendra Modi’s government, which has been working to boost domestic manufacturing and exports through its Make in India campaign.

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Two people with knowledge of Apple’s plans said the new phone would be assembled by Foxconn Technology Group and Pegatron, which have plants in the southern state of Tamil Nadu, as well as Wistron, which has a factory in neighbouring Karnataka.

One of the people said that Foxconn had begun shipping the iPhone 14 last Friday, and that the larger iPhone 14 Plus would be shipped by Pegatron and Wistron by the end of October.

Foxconn and Wistron did not reply to a request for comment, and Pegatron declined to comment.

Mr Modi’s government has been trying to build up high-tech manufacturing in a bid to bolster local industry, create jobs, and attract foreign companies.

“Given the global geopolitics and the emphasis on diversification of supply chains away from China, there was a clear idea that India should benefit,” said Anirudh Suri, author of The Great Tech Game: Shaping Geopolitics and the Destiny of Nations. “It’s great for India, and shows this is not just a conceptual thing.”

Apple unveiled its two new 14 models on September 7th part of a push to extend its foothold in the top-end smartphone market.

JPMorgan said in a research note last week that it expected Apple to move about 5 per cent of its iPhone 14 production from late 2022 to India, and that the US tech company would be producing one in four of its devices, including iPads and watches, outside China by 2025.

India has the second largest number of smartphone users in the world after China, but Chinese brands such as Xiaomi and South Korea’s Samsung dominate the local market. – Copyright The Financial Times Limited 2022

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