iPhone production in India is expected to gain a further boost as a third of Apple’s smartphone assemblers are reportedly setting up their country’s first factory. Foxconn and Wistron already have several assembly plants in India, and it is now said that Pegatron is building its first plant there. Apple has long sought to reduce its dependence on China by encouraging its suppliers to establish operations in other countries.
The US trade war with China exposed the weakness of bringing so many of Apple ‘s manufacturing resources within a single region, and this was underlined when the coronavirus epidemic saw several factories temporarily shut down there, while others were operating at considerably reduced capacity.
Foxconn has facilities in China, India , Thailand, Malaysia, South Korea , Singapore, the Czech Republic and the Philippines. Wistron operates in China, Mexico, the Philippines, Brazil and Taiwan. Pegatron has been working on building production capacity in Indonesia, Vietnam and India for a long time, but in the latter region, we now have the first evidence of its plans.
The Indian government unveiled a $6.6 billion campaign in June to attract the world’s top smartphone makers, offering financial rewards and ready-to-use manufacturing clusters. Pegatron is now forming a local subsidiary and joining fellow Taiwanese electronics assemblers Foxconn Technology Group and Wistron Corp., who have made some iPhone handsets in southern India.
With several factories in China, Pegatron is the second-largest iPhone assembler and more than half of its business depends on Apple. It will be set up in the south of India, like its peers, according to a person familiar with his plans who asked not to be named.
According to Matthew Kanterman of Bloomberg Intelligence, Foxconn, also known as Hon Hai, and Wistron are looking to expand their operations in the region, and Pegatron ‘s entry can be seen as a defensive step to safeguard its share of iPhone manufacturing budget.
Initially, the development of iPhone in India was for goods sold within the country only. But a combination of Apple ‘s desire to be less reliant on China, and the Indian government’s blend of carrot-and – stick policies in support of its Made In India campaign has also seen demand improving export models.
In addition, more of the pre-assembly work is being carried out in India in response to tariffs on imports of components designed to promote more local production. In February we learned that Wistron is now performing assembly of printed circuit boards within India. These were manufactured in China beforehand, and then sent to India.