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Apple suppliers plan to move production to India

An unspecified Apple supplier is planning to relocate a significant portion of its manufacturing operations to India The times of India.

The nameless Apple contract manufacturer is expected to relocate a total of six production lines to allow $ 5 billion worth of devices to be exported from India. The establishment of a new plant for these new Indian production lines is expected to employ around 55,000 people in the course of a year. It will start manufacturing iPhones, but can be expanded to other devices in the coming years.

Apple suppliers Wistron, Pegatron, Foxconn and Samsung are expected to set up manufacturing facilities in India. These providers are expected to be supported by the Indian providers Dixon Lava and Micromax in the delivery of Apple.

Foxconn announced last month that it plans to invest up to $ 1 billion in India and has already built its first manufacturing facility in India. Last month, Apple started manufacturing the iPhone 11 at Foxconn’s Indian plant. It was the first time that a top-of-the-range model was made in the country.

Many companies plan to diversify their supply chains to reduce their dependency on China, which has been scrutinized in the face of the global health crisis and the trade war with the United States.

The Indian government has motivated production with the “Production Linked Incentive” (PLI) program, which aims to attract companies with high demands on electronic components and semiconductors. The government has pledged up to six percent of the cost of locally produced goods over the next five years. 22 companies from different countries, including Taiwan, South Korea and Germany, have already applied for the PLI program. There were no applications from Chinese companies. The program has already exceeded the government’s manufacturing target for manufacturing.

India is the second largest smartphone market, but Apple has generally struggled to gain a foothold in the country in the past. Apple almost exclusively sells devices made in China in India. However, an increase in local production would take advantage of the government’s “Made in India” initiative, which could save Apple up to 22 percent in import duties and give them the opportunity to lower prices. If the expansion of the Apple supply chain to India is successful, Apple could use the country as an “export hub”.

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