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7 Dec, 2023 15:43

Apple looking to India for critical components – FT

The US firm reportedly wants batteries for its latest iPhone to be made in the South Asian country
Apple looking to India for critical components – FT

US tech giant Apple wants India to produce batteries for its latest generation iPhone as it seeks to diversify its global supply chain and reduce reliance on Chinese manufacturing, the Financial Times reported on Wednesday citing sources.

According to the FT, Apple has told component suppliers that it prefers to source batteries for the forthcoming iPhone 16 from factories in India.

The firm has encouraged some of its Chinese and Taiwanese suppliers to set up new production facilities in the South Asian nation or expand output at existing sites for future orders, the outlet wrote.

The move aligns with New Delhi’s “Make in India” campaign which offers incentives to firms that develop and manufacture their goods domestically.

Apple reportedly plans to scale up production in India over five-fold to around $40 billion in the next four to five years, local media reported in September, citing government sources.

The tech giant started making its iPhone 15 in India in August at a factory belonging to Foxconn, the world's largest contract manufacturer of electronics. The Taiwanese-headquartered company plans to build a new $1.5-billion production facility in India.

According to Apple analyst Ming-Chi Kuo, currently 12-14% of iPhones sold globally are made in India, with that proportion set to increase to 20-25% over the coming year.

The decision to expand iPhone production in India is mostly due to supply chain issues in China, Forbes cited analysts as saying. After a major factory in Zhengzhou was shut down due to a Covid outbreak in October 2022, and then rocked by violent protests over pay and conditions, Apple struggled to meet the demand for the last year’s holiday season.

The US crackdown on the Chinese tech industry has also caused challenges for Apple. Restrictions issued in October 2022 prohibited American firms from selling equipment to Chinese chipmakers, among them Yangtze Memory Technology Corporation, with whom Apple had reportedly been in talks to supply iPhone parts.

Another US tech giant, Microsoft, also recently moved some of its manufacturing to India.

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