Amid the reports that the overall iPhone shipments are decreasing in India, Apple has decided to boost its local presence there.
Current plans suggest that Apple will begin assembling its handhelds at a Foxconn plant in Tamil Nadu, the south of the country. Further, the tech giant Foxconn will start assembling more higher-end devices, such as iPhone X, at its plant in the city of Sriperumbudur. Since Foxconn is currently producing the Xiaomi phones at this factory, the company is planning a new $356 million production line expansion that will create 25,000 jobs. Aside from Foxconn ventures, a second Taiwanese company, Wistron Corp, will be handling primarily iPhone 8 unit production.
The manufacturing of iPhones in India should result in a significant cost decrease because Apple will be able shed majority of import taxes and trade tariffs. Due to these lower costs, even the higher-end iPhones should become more affordable in local markets, attracting more Indian customers. It should be noted that iPhone retail prices in India are some the highest around the world. That’s true for absolute costs in USD as well as in relative costs that look at price to income ratio.
There is no exact date when production will start but it’s an integral step for the “Make In India” program. Until now, the Cupertino-based Apple has only manufactured the lower-end iPhones in India, specifically the SE and 6S.
The Indian government authorities have already approved and signed this plan. The country’s minister said that the Foxconn expansion combined with the Wistron factory will be a big push for the “Make in India” vision. As an economy, India will further benefit from creating many new quality jobs.