Apple is moving a step ahead to start production of the latest iPhones in India. According to a new report, Foxconn will begin manufacturing the latest iPhones in Chennai on a trial basis. In India, this won’t be the only Apple’s manufacturing facility, Wistron already produces the old iPhone models like 6S, SE in its Bangalore plant.
The new initiative from Foxconn will help reduce the higher prices on Apple products. Both the company and consumers would benefit from production in India. It would result in avoiding 20% import duties, and 30 percent of local sourcing will further allow the company to open more offline stores in the country.
After the launch of iPhone X, the Apple devices sales plunged in India, despite its remarkable specifications. The only reason cited by sources for such a decline is its higher pricing which could not be justified in the developing country. The declining sales and trade tensions between the US and China are some reasons behind Foxconn’s move towards India.
“Seen from Cupertino the India market looks minuscule so Apple’s strategy has been myopic,” said Neil Shah, research director at Counterpoint Research. “They haven’t capitalised on the ground potential — India will cross half-billion smartphone users this year.”
It is a step ahead towards reaping the benefits of such a big market. Along with cost reduction, some more budget options can also be expected with the introduction of Foxconn’s manufacturing unit in India. It is a win-win situation for both, Apple and consumers. The timely expansion will help the Cupertino giant to safeguard itself from political tensions between the US and China. “Apple no longer wants to keep all its eggs in one basket,” said Shah.
Foxconn will start with the initial investment of $300 million in the iPhone production line, and expected to multiply in the future. All investment will come under the “Make in India” campaign.
