As part of Apple’s recent indication at diversifying it’s supply chain to India, Apple is asking its suppliers to move some of its AirPods and Beats production to India for the first time ever.
This comes after Apple started manufacturing its latest iPhone model in its Indian facilities in record time—approximately three weeks after manufacturing was commenced by its Chinese suppliers.
Win for Centre
This move could be a win for the Centre, which has been asking global technology giants to localise their supply chains to India. As per reports, Apple has also been looking to diversify its supply chain away from China.
As per reports, Apple supplier Foxconn is preparing to make Beats headphones in India and hopes to eventually make AirPods in the country as well.
Luxshare Precision Industry, a Chinese supplier to the iPhone maker, also plans to help Apple manufacture AirPods in India.
Apple supplier Foxconn is a beneficiary of the production linked incentive (PLI) scheme, which provides the firm with substantial subsidies to manufacture in India. Foxconn has just completed its first year under the PLI.
Optimistic
While India has traditionally been a low volume market for Apple, experts predict that the iPhone maker will achieve its best ever performance with its recent iPhone 14 launch. The recent trends in premiumisation bode well for sales. Apple could achieve sales numbers such as 4 per cent of phone sales this year according to experts.
Reports also suggest that Apple Inc.’s iPhone exports from India crossed $1 billion in the five months since April.
At the current rate, outbound shipments of India-made iPhones, mainly to Europe and West Asia, are set to reach $2.5 billion in the 12 months through March 2023, as per reports.
However, while Apple has started to make headway in localising manufacturing in India, it will take many years and a lot of effort to make Indian manufacturing a veritable competitor to China. Presently, India makes only a small fraction of the iPhone output for Apple in comparison to China, where it has cultivated the supply chain for two decades. Last year, over 230 million iPhones were manufactured in China, compared with 3 million units made in India.
Published on October 5, 2022
