Key takeaways
- Apple is diversifying its supply chain by expanding production in India amidst geopolitical tensions and China's strict policies.
- The company is in discussions to establish an iPad production facility in India, reflecting its commitment to the region.
- Recent protests in China have prompted Apple to reconsider its manufacturing strategies and explore alternatives in India and Vietnam.
- India's emergence as a viable production hub is hindered by a shortage of skilled engineers and specialised component manufacturers.
- Apple's expansion in India includes the production of iPhone 14, building on previous successes since 2017.
Amidst rising geopolitical tensions and China's strict Zero-Covid policy, Apple plans to diversify its supply chain and move its production out of China to countries like Vietnam and India. A 2019 Nikkei report suggested that Apple would explore moving up to 30% of its production outside China.
Also Read: Apple Freezes Hiring, Ramps Up Manufacturing Capabilities in India
The move also comes after violent protests at an iPhone manufacturing facility in Zhengzhou, China relating to contract terms over wages and the fear of Covid-19 spread due to workers living in dormitories.
As per reports, India has emerged as a serious contender, with officials holding discussions with Apple to move its iPad production to India. However, some key issues highlighted that could slow Apple's plans for India are the need for more highly skilled engineers and component manufacturers specialising in iPad.
Earlier this year, Apple announced that it would start its iPhone 14 production in India, with Foxconn, its subcontractor, setting up a plant in Chennai. However, the previous models have been in production in India since 2017. The new production line will expand Apple's footprint in the country if an agreement is reached.
From April to October 2022 alone, Apple's smartphone exports from India cost $2.2 billion and are set to overtake Samsung in smartphone exports this fiscal year. The figures indicate that India is a proven ground for Apple to shift the majority of its production to the country.
