Apple seems to have turned the steering wheel further towards India as its partner Foxconn has planned to invest $1 Billion in India. The Taiwanese multinational contract manufacturer looks forward to expand the already-operating facilities in Tamil Nadu. This is in a bid to increase the capacity and move the production out of China as planned earlier.
According to a report by Reuters, the plan is to move a part of iPhone production out of China. The move comes at the wake of a long-standing trade war between the US and China. Add to this, the coronavirus had made things worse by disrupting the supply chain.
More iPhone models to be assembled in India
Sources for Reuters said, “Apple has strongly requested its clients to move a part of iPhone production outside of China”. Following this, the $1 Billion investment of Foxconn on its plant at Sriperambudur. Located at 50KM West of Chennai, it is set for a period of three years to expand the production facilities.
One of the sources also seems to have pointed out that the investment will hike job opportunities by 6,000. If we recall, Foxconn Chairman Liu Young-way had said last month that the company would ramp up the production in India.
However, on Reuters’ request, Apple hasn’t officially commented on this as of yet and Foxconn has declined to comment on behalf of its customers. Further, the sources have also said that the move will enable Foxconn and Apple to start assembling other models of iPhones in addition to iPhone XR, SE in future as well.
Apple in India so far & what’s ahead
Apple, despite being a premium brand, only sells the SE and base variants of its iPhones like the XR, XI, at competitive prices. It is often with import duties for its higher variants. And that has hampered the sales in certain regions to a greater extent.
Hence, the company accounts for only about 1%-2% of smartphones sold in India. This is in spite of holding a great market share of 62.7% of the premium market (as of Q1 2020). This is due to a fierce competition from its competitors like Samsung, OnePlus, Xiaomi. Chinese companies often give more value for money devices to customers at cheaper price tags.
That being said, the latest investment comes as an addition to the already confirmed plans of opening Apple stores in India. Albeit being a long term plan, Apple has set a precedent that it certainly isn’t going to miss out on the world’s second-largest market going forward.