As part of Apple’s efforts to expand production in the nation of South Asia, conglomerate Tata Group intends to construct one of India’s largest iPhone assembly plants.
Sources with knowledge of the matter claim that Tata intends to build the factory in Hosur, in the southern state of Tamil Nadu. According to the people discussing the undisclosed plans, the facility is expected to have roughly 20 assembly lines and employ 50,000 workers within the next two years. In twelve to eighteen months, the site should be up and going.
In addition to strengthening Apple’s relationship with Tata, which already owns an iPhone factory in the neighboring state of Karnataka that it purchased from Wistron, the plant would support Apple’s efforts to localize its supply chain. By collaborating with partners in Thailand, Malaysia, India, and other countries to manufacture components and assemble products, Apple is expanding its operations beyond China.
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When contacted for comment, a Tata representative did not reply, and an Apple spokesman declined to comment.
The Indian conglomerate has taken additional actions to broaden its business beyond its traditional software and salt businesses and to increase its business with Apple. The company has increased hiring at its current Hosur facility, which makes metal casings for iPhones. Tata has also declared that it will open 100 retail locations that specialize in Apple goods. As for Apple, it has already opened two locations and plans to open three more across the country.
Key suppliers to Apple, including Taiwan’s Foxconn and Pegatron, have increased their presence in India as a result of production-linked subsidies offered by Prime Minister Narendra Modi. As a result, India was able to assemble more than $7 billion worth of iPhones during the previous fiscal year, contributing to India’s roughly 7% production share of the device. The remaining ones are put together in China, which produced them all up until a few years ago.
Among iPhone factories worldwide, the new facility is expected to be of a medium size. It would probably be larger than the one Tata purchased from Wistron, which has over 10,000 workers, but smaller than the largest Foxconn plant in China, which has hundreds of thousands of workers.
The new factory is expected to start production right before the previous state-backed financial incentives are about to expire, so Apple and Tata may lobby the government to grant subsidies for it.
© 2023 Bloomberg L.P.
