Apple has started assembling the iPhone 14 models in India, it said on Monday, producing the current range locally for the first time in the same calendar year in the world’s second-largest smartphone market, as analysts predict a bigger change in the future manufacturing of the American giant.
The company’s global partner, Foxconn, manufactures the device at the Sriperumbudur plant near Chennai. Locally produced iPhone units will go on sale in the country later this year. “We are excited to manufacture iPhone 14 in India,” an Apple spokesperson told TechCrunch in a statement.
Apple started assembling smartphones locally in India in 2017, but until this year the iPhone maker used manufacturing facilities in India to assemble older-generation handsets. Apple launched the iPhone 14 models earlier this month.
Analysts believe Apple will turn India into a global iPhone manufacturing hub by 2025 as it slowly reduces its dependence on China, where it has produced the vast majority of its devices for more than a decade. ‘a decade. In a report released earlier this month, JP Morgan analysts said Apple would shift 5% of global iPhone 14 production to India by the end of 2022 and expand manufacturing capacity in the country to produce 25% of all iPhones by 2025.
India has attracted investment from Apple’s manufacturing partners Foxconn and Wistron in recent years by offering lucrative grants as New Delhi strives to establish the country as a manufacturing hub. The presence of foreign manufacturing giants, coupled with “abundant labor resources and competitive labor costs,” make India a desirable location, JP Morgan analysts said.
“The iPhone supply chain in India has historically only supplied legacy models. Interestingly, Apple has asked EMS vendors to manufacture iPhone 14/14 Plus models in India in 4Q22, within two to three months of the start of production in mainland China. The much shorter interval implies the growing importance of Indian production and likely higher iPhone allocations to Indian manufacturing in the future,” the report adds.
“We believe that Apple is only producing iPhone 14/14 Plus models in India currently due to the more complex alignment of iPhone Pro series camera module (done by EMS vendors) and demand higher in the local market for the iPhone 14 series (tax savings). We expect volume to start small in 4Q22 (~1 million units per month, or 5% of total iPhone volume).
As Apple expands its local manufacturing capacity in India, many hope it will make its handsets affordable in the country. The base iPhone 14 model, which costs $799 in the US, costs 79,900 Indian rupees ($980). While the entry-level iPhone Pro Max model costs $1,717 in India compared to $1,099 in the US.
Even though Apple holds a tiny market share in India, the iPhone maker has expanded its investments in the country over the past five years. He opened his online Apple Store in the country two years ago and has publicly stated that he is working on launching his first physical store in the country.
Apple rival Samsung already identifies India as a key global manufacturing hub and has set up one of its largest factories in the country. Chinese smartphone maker Xiaomi, which currently dominates the market, along with rivals Oppo, Vivo and OnePlus also locally assemble a number of their handsets in the country.
Google also plans to move some production of Pixel smartphones to India, The Information recently reported. The company, which has not shipped flagship models to India for two generations, said last week that it will launch the next Pixel 7 models in India.