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The move, which would entail significant capacity build-up at Apple\u2019s India partners, comes in the backdrop of a US-China trade standoff that threatens the company\u2019s long-standing supply chain balance.\u00a0China currently accounts for 80%\u00a0of all iPhone manufacturing for Apple, according to data from market researcher International Data Corporation (IDC),\u00a0and\u00a0India has 10%\u00a0share.<\/p>\n
Earlier on Friday, a report by\u00a0Financial Times\u00a0<\/i>said that Apple could make all iPhones bound for the US market in India by next year,\u00a0amounting to 60 million units in volume.<\/p>\n
\u201cThis would be an exaggerated target\u2014ramping up a stable supply chain and doubling capacity does not happen within mere months,” one of the people cited above said. \u201cThere is, however, a clear understanding at Cupertino that Apple\u2019s India production plans are now on steroids after US president (Donald) Trump\u2019s volatile foreign trade policies and the China situation.”\u00a0<\/p>\n
Also read<\/strong> | With electronics tariffs off, what happens to iPhone in India?<\/a><\/p>\n Two others said that Tata Electronics, which accounted for a quarter of all iPhones made in India as of January, is slated to be the biggest benefactor of Apple\u2019s India push. The company could contribute the most to ramping up Apple\u2019s capacity of assembling iPhones in India and exporting them to the US.<\/p>\n Apple did not immediately respond to Mint\u2019s <\/i>emailed queries. Tata Electronics declined to comment.<\/p>\n Reaching a target of 50 million iPhones by 2028, however, would require a significant upgrade of capacity among Apple\u2019s manufacturing partners in India. Alongside Tata Electronics, Taiwanese contract manufacturer Foxconn\u2019s India joint venture\u2014Bharat FIH Ltd\u2014is also a key iPhone production partner for Apple.<\/p>\n It is because of this tall target that Apple is looking for its India manufacturing partners to ramp up production capacity, the people cited above said.<\/p>\n \u201cThere are discussions that the US government\u2019s potential long-term exemptions that could be on offer to Apple would be hinged upon them making efforts to move manufacturing away from China in the short term,” the third person cited above said. \u201cAfter all, those in the sector understand that setting up an entire supply chain in the US would not be possible within a year or two. Shifting production to trusted geographies could thus be crucial for Apple.”\u00a0<\/p>\n Read this <\/strong>| Mint Primer: Will US tariffs on Indian goods hit iPhones prices?<\/a><\/p>\n To be sure, a 2018 report by\u00a0Reuters\u00a0<\/i>had claimed that by 2028, Apple planned to make one of every four iPhones in India. At the end of last year, supply chain estimates said that Apple makes roughly 20 million iPhones in India, which are supplied to various global markets and also to Indian retailers.<\/p>\n Some industry stakeholders expect this to be beneficial for India in the long run, while others point to the huge gap between assembly of iPhones that the country is currently doing, and the expertise to add more local inputs, which will take time.<\/p>\n Ashok Chandak, president at industry body India Electronics and Semiconductor Association (Iesa), said that the move will help \u201cexpand the size of India\u2019s electronics manufacturing economy, and bring India closer to its target of a $500 billion electronics market by 2030″.<\/p>\n \u201cApple is, of course, one of India\u2019s biggest contributors to electronics manufacturing and exports, and India has gained from Apple\u2019s brand weight by showcasing to the world that it can assemble what is considered to be the most sophisticated engineering in smartphones right now,” Chandak said.<\/p>\n He added that going forward, ramping up capacity further will only prove that India can maintain consistency at scale, \u201cwhich is the final step before India\u2019s electronics economy starts moving up the value chain”.<\/p>\nMixed reactions<\/h2>\n