Apple, the world’s third-largest smartphone vendor, plans to shift the assembly of its flagship smartphone outside China for the first time. As much as 10 percent of iPhone 12 production will be moved to India.
Nikkei Asia reports that electronics contract manufacturer Foxconn will manufacture the iPhone 12 5G series at its facilities in the state of Tamil Nadu, which also assembles other models including the iPhone 11 and iPhone XR.
Previously, apart from Foxconn, other electronics contract manufacturers, namely Wistron, and Pegatron produced all iPhone models, with the majority being assembled in China.
India Today reports that Apple is “proud” to begin production of its newest flagship product “for our local customers” in the country.
Foxconn has been trying to reduce dependence on China because trade tensions with the US have not yet subsided, even though the White House has entered Joe Biden’s presidency since last January.
To support the relocation of production, Apple plans to invest as much as $ 1 billion in facilities in southern India over the next three years, added Nikkei Asia.
Just to note, Apple started producing an affordable model, the iPhone SE in India in 2017. After assembling the first model, Apple trusted Wistron to produce the latest generation iPhone SE after its official launch in April 2020.
The local production of the second generation iPhone SE indicates Apple’s seriousness towards India, which is the second largest smartphone market in the world. Assembling the iPhone SE locally in India will help Apple avoid the 20 percent import duty the Indian government levies on imported smartphone units.
On the other hand, the relocation of iPhone 12 production shows India has become a major global mobile manufacturing center, after China. PM Narendra Modi’s “Making in India” policy in recent years has attracted many global smartphone vendors to produce their handsets in the country.
Various policies were issued, including in November last year. The government is providing INR450 billion ($ 6.12 billion) of incentives to 16 domestic and international electronics companies, including Samsung and three of Apple’s contract manufacturing partners. The incentive provision aims to increase smartphone production over the next five years.