Apple is actively pursuing partnerships with Indian manufacturers to establish a local supply chain beyond iPhone production, potentially including components for wearables and other devices, as its China-based suppliers show reluctance to invest in India.
According to MoneyControl, Apple has initiated discussions with over 40 Indian enterprises, including major conglomerates, IT companies, and electronics manufacturing service providers, to develop a network of local suppliers for components used in iPhones, MacBooks, iPads, and AirPods. The company has engaged with notable firms such as Dixon Technologies, Amber Electronics, HCLTech, Wipro, and Motherson Group, as Chinese component suppliers remain hesitant to make substantial investments in India due to existing tax and legal challenges facing Chinese smartphone companies.
The path to establishing these partnerships requires patience, as demonstrated by Aequs Group's experience, which took nearly two years to reach the trial phase. However, Apple's timing aligns strategically with India's upcoming electronics components incentive scheme, which aims to facilitate partnerships between Indian companies and global technology partners. Despite these initiatives, reducing dependence on Chinese suppliers presents significant challenges, considering China's role as Apple's primary manufacturing and sourcing hub until 2020.
Apple's expansion plans in India extend to manufacturing various products and components. The company is currently scaling up production of AirPod wireless charging case components at Jabil's facility in Pune, while Foxconn is preparing to begin AirPods manufacturing in Telangana next year. By the end of fiscal year 2025, Apple aims to increase India's share of its production volume to 17-18% and production value share to 14%, targeting a production value of US$18 billion and a market value of approximately US$27 billion.
A significant development occurred in mid-November when Tata Electronics reportedly agreed to acquire a 60% stake in Pegatron's iPhone manufacturing plant in India. This joint venture, which places Tata in charge of daily operations, represents a notable advancement in the country's electronics sector.
Other global manufacturers are also expanding their presence in India. In October, Foxconn disclosed in a corporate filing that its Indian subsidiary invested US$31.8 million in equipment from Apple Operations to support operational requirements.
Additionally, the Economic Times reported that Apple supplier Jabil plans to invest INR20 billion (US$240 million) in a new facility in Trichy, Tamil Nadu, following the signing of a memorandum of understanding with the state government.
