Apple fast forwards plans to shift manufacturing from China to India, Vietnam: Report

iPhone shipments in the fourth quarter this year are likely to reach around 70 million to 75 million units, nearly 10 million less than market projections before the China turmoil, analyst Ming-chi Kuo predicts.

IANSUpdated: Monday, December 05, 2022, 02:14 PM IST
article-image
People protest against China's zero-COVID policy | Picture courtesy: ANI

Apple is fast forwarding its manufacturing plans in India and Vietnam in the wake of China unrest over zero-Covid policy which has severely disrupted its supply chain, leading to an acute shortage of new iPhone 14 Pro models.

The Wall Street Journal reported that the company is "telling suppliers to plan more actively for assembling Apple products elsewhere in Asia, particularly India and Vietnam" in order to "reduce dependence on Taiwanese assemblers led by Foxconn".

Violent protests hit Foxconn’s factory

The China upheaval, which hit its key supplier Foxconn's Zhengzhou factory last month resulting in violent protests, means "Apple no longer feels comfortable having so much of its business tied up in one place," the report said, citing analysts and people in the Apple supply chain.

Analyst Ming-chi Kuo has predicted that iPhone shipments in the fourth quarter this year are likely to reach around 70 million to 75 million units, nearly 10 million less than market projections before the China turmoil.

The top-of-the-line iPhone 14 Pro and Pro Max models have particularly been hit hard, according to him.

Apple iPhones in India

Apple aims to ship 40-45 per cent of iPhones from India compared with a single-digit percentage currently, according to Kuo.

Every fourth iPhone will be made in India by 2025, according to JP Morgan.

In a fillip to India's thrust on local manufacturing, Apple earlier this year kicked off the production of new iPhone 14 in India, a first for the tech giant as it narrows down the manufacturing period of new iPhones in the country to cut dependence on China.

Buoyed by the ease-of-doing business and friendly local manufacturing policies, Apple's 'Make in India' iPhones will potentially account for close to 85 per cent of its total iPhone production for the country this year, according to industry experts.

iPhone imports to go down

The import of iPhones to India is likely to come down to 15 per cent this year (from 50 per cent in 2019), while domestic manufacturing by the Cupertino-based tech giant is set to go up substantially to 85 per cent, according to market intelligence firm CyberMedia Research (CMR).

With the iPhone 14 series, Apple's iPhone production in India is slated to jump from 7 million iPhones in 2021 to touch a new milestone of around 12-13 million iPhones in 2022.

As per CMR, the contribution of domestic iPhone manufacturing in India jumped from 50 per cent in 2019 to 73 per cent in 2021.

In the meantime, the percentage of imported iPhones to India decreased from 50 per cent in 2019 to 45 per cent in 2020, 27 per cent in 2021 and around 15 per cent this year -- showing a significant make in India's boom for Apple.

Apple first started manufacturing iPhones in India in 2017, with iPhone SE.

The tech giant manufactures some of its most advanced iPhones in the country, including iPhone 11, iPhone 12 and iPhone 13 at the Foxconn facility while iPhone SE and iPhone 12 are being assembled at the Wistron factory in the country.

(If you have a story in and around Mumbai, you have our ears, be a citizen journalist and send us your story here. )

(To receive our E-paper on WhatsApp daily, please click here.  To receive it on Telegram, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)

RECENT STORIES

Ahead of Market: Here are factors to consider and stocks to look for

Ahead of Market: Here are factors to consider and stocks to look for

London Science Museum to continue association with Adani Group: Report

London Science Museum to continue association with Adani Group: Report

6 common money fears and ways to conquer them

6 common money fears and ways to conquer them

Gautam Adani's half wealth goes in a flash

Gautam Adani's half wealth goes in a flash

Interpol extends its jurisdiction into the virtual world, will investigate crimes in metaverse

Interpol extends its jurisdiction into the virtual world, will investigate crimes in metaverse