Following the mounting geopolitical tensions in China, Apple may decide to move away some productions of iPhones from the country.
With this, the Cupertino-based company could possibly move 25% of its entire iPhone production line to India by 2025, according to JP Morgan analysts.
Apple to Turn India into a Key Global Manufacturing Hub
According to TechCrunch, a report sent by JP Morgan analysts stated that Apple is planning “to move 5% of the global iPhone 14 to India by late 2022.”
By 2025, the tech giant is planning to expand its manufacturing capacity in the country in order to produce 25% of the entire iPhone production line.
A few years ago, Apple began to assemble some of its devices in India and Vietnam. With this move, the company slowly cut its dependence on China.
With its plan to move 25% of iPhones manufacturing to India, it is gearing to make the country one of its key global manufacturing hubs, analysts at JP Morgan said.
Currently, Apple manufactures some of its iPhone models in India. Among these models are the iPhone 13 and soon the iPhone 14.
However, the tech company’s supply chain is still heavily concentrated in China. In the previous years, though, the company has worked to move suppliers and production lines to other countries, including India and Vietnam.
In the last several years, Foxconn and other Apple suppliers have invested heavily in India with supply chain infrastructure, factories, and training.
The production of iPhone 14 models in India is expected to happen in the coming weeks, according to MacRumors.
Apple Will Also Move its Production in Vietnam
Apple has plans to make India one of its key global manufacturing hubs. Since 2017, iPhones have been assembled in the country through Wistron and later via Foxconn, as per Reuters.
While the pandemic slowed down supply chain relocation plans for businesses, more companies, including Apple, are reaccelerating relocation plans with the easing of restrictions.
According to analysts, the presence of foreign production giants in the country, together with “ample labor resources and competitive labor costs,” make India a desirable location for businesses.
In fact, Samsung put up one of its largest factories in the country as the company recognizes India as a global manufacturing hub, as per TechCrunch.
Other smartphone makers such as Xiaomi, Oppo, Vivo and OnePlus also put up factories in India where their handsets are assembled.
A recent report stated that even Google also plans to put up factories in the country. The said company plans to move some of Pixel smartphones’ production to India.
In the past five years, Apple has “broadened its investment” in India. Two years ago, the iPhone maker opened an online Apple Store in the country, and currently, it is working to bring its first physical store.
Meanwhile, aside from India, Vietnam is another country Apple is eyeing to turn into a key global manufacturing hub.
Vietnam is said to contribute 20% of all iPad and Apple Watch productions, 5% of MacBook, and 65% of AirPods by 2025.