BEIJING, April 14 (TMTPOST)— Apple Inc. has been ramping up production in India as it speeds up its pivot away from China.

Source: Visual China

The value of India-made iPhones tripled to more than $7 billion in the fiscal year ended March, 2023, and most of it, about $5 billion, was exported, almost quadrupling export value in the previous year, Bloomberg reported. This is an impressive leap for Apple now reportedly makes nearly 7% of iPhones in India, up from just 1% in 2021. Moreover, Apple could work to unprecedentedly produce the next generation of iPhone series, which are set to be released in this fall, in India at the same time as in China, and it could assemble a quarter of all iPhones in India by 2025, if the aggressive expansion trend of its suppliers, ranging from Foxconn Technology Group to Pegatron Corp., lasts, according to the report.

This is the latest sign to show Apple’s refocus on regions outside like India, Vietnam and Mexico to reduce its heavy dependence on China. It came days before Apple’s first physical stores in India open. The firm confirmed earlier this week to open retail store in Mumbai on April 18 and the next in Delhi two days later. As another signal to suggest India’s growing importance to Apple, CEO Tim Cook was reported to travel to India open the first stores there, accompanied with Deirdre O'Brien, the senior vice president of Retail + People. The company has reportedly arranged for Cook to meet India’s Prime Minister Narendra Modi in his first trip in the country in seven years.

Indian official has suggested Apple’s ambitious plan for production shift. Apple has already made about 5% to 7% of its production in India, and “If I am not mistaken, they are targeting to go up to 25% of their manufacturing, Piyush Goyal, the Commerce and Industry Minister, said in January. The minister cited Apple as a successful example to show foreign companies benefited from Indian government’s transparent policies and other efforts to attract foreign investors.

Apple announced in last April to start making iPhone 13 in India and confirmed five months later that it was assembling iPhone 14 in India, less than three weeks from its release of the new iPhone series.The confirmation suggests India will first make the latest flagship iPhone.  

Reports last month said Foxconn was planning to invest about $700 million to build a new plant near the airport in Bengaluru, and mull another new production site in Hyderabad, the capital of southern India's Telangana state, as well as a silicon carbide fabrication plant and packaging facility for its semiconductor business. The key iPhone maker is also poised to expand production in its existing facility in Chennai, the capital city of the southern Indian state of Tamil Nadu, aiming to boost iPhone production from about 6 million to 20 million by 2024, and its workers there around tripling to as many as 100,000, according to the report.

Quality, among others, is a major concern for Apple’s shift plan. Only about 50% of iPhone casings produced in a factory under Indian conglomerate Tata is good enough to be sent to assembly, and the 50% yield is well below Apple’s zero-defect goal, Financial Times reported in February. The factory in Hosur was reported to plan to improve proficiency but the road ahead is long.

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