Apple is moving to increase production of iPhones in countries including India by reducing production in Chinese plants. Taiwanese company Pegatron Corporation, which manufactures iPhones for Apple, has also started assembling the latest iPhone 14 model in India.
Foxconn’s plant in Zhengzhou, the world’s largest iPhone manufacturing hub, has been shut down as China sticks to a strict zero-covid policy. However, Apple needs to produce more iPhone 14 and deliver it to the market. This is why the second plant has started to manufacture iPhone 14.
Foxconn started manufacturing the iPhone 14 in India in September, weeks after its global launch. The trade war between Washington and Beijing and the strict implementation of Xi Jinping’s Covid-zero policy in China are causing a huge crisis for Apple. This is what helped India.
Apple’s contract manufacturers in India such as Foxconn, Wistron and Pegatron are moving forward with plans to manufacture more handsets. They are trying to use more plants in India to make up for the slowdown in iPhone production in China.
Both Foxconn and Pegatron have plants in Tamil Nadu. Meanwhile, Wistron manufactures iPhones from Bengaluru. iPhone SE, iPhone 12, iPhone 13 and iPhone 14 (basic) models are currently manufactured in India. However, all Pro models sold in the country are imported.
Wistron is going to open another manufacturing facility in Kolar by the end of November and start production from January, a company spokesperson said. Wistron currently has four assembly lines for manufacturing the iPhone 14 at its Kolar plant. Foxconn’s manufacturing facility in Chennai is being expanded. Another executive said more hiring is currently underway. Pegatron started manufacturing iPhones in September.
China’s share of global iPhone production is expected to decline from 95.8 percent in 2021 to 91.2-93.5 percent of global exports in 2022. By the end of this year, India’s contribution will rise to 5-7 percent of global exports and 85 percent of regional demand. That’s up 3 percent from last year, according to Counterpoint Research.
Apple’s India sales in 2023 are expected to surpass the 60 lakh units expected in 2022, driven by growing demand for premium smartphones with discounts and cash back offers, according to an IDC India report. In 2021, iPhone sales were 48 lakh.
All three manufacturers are part of the central government’s Rs 41,000-crore Production-Linked Incentive Program (PLI). Pegatron started manufacturing iPhones from this year and will be able to claim benefits till March 2023 in the next financial year. Counterpoint senior analyst Evan Lam said the biggest obstacle to shifting more production from China is that most iPhone components are still made there and need to be shipped to where the handsets are assembled.