Apple will through Foxconn’s local unit begin to assemble its top-end iPhones in India as early as 2019, reports CNBC. Citing sources familiar with the matter, the report disclosed that the Taiwanese contract manufacturer, which will potentially take Apple’s business in India to a new height, will most importantly be assembling the most expensive iPhone modes, such as devices in the iPhone X family.
Foxconn will assemble iPhones for the first time in India at its plant in Sriperumbudur town, located at the southern part of Tamil Nadu state, according to the report.
Minister for Industrial Department M. C. Sampath of Tamil Nadu told Reuters that Foxconn, which is currently producing phones for Xiaomi Corp, will expand its production plant by investing some INR25 billion ($356 million) to meet up with the deal.
The investment would create up to 25,000 jobs in the state, which represents the second-largest economy in India, Sampath added.
Low-cost Apple iPhones already assembled in India
California-based Apple until now assembles its low-cost iPhone modes: SE and 6S through Wistron Corporation’s manufacturing facility in Bengaluru, India. As a result, iPhone sales in India have been driven by iPhone’s lower models. The iPhone 8, launched last year, constitutes over half of Apple’s sales volume, according to Counterpoint – a technology research company.
Apple started building the iPhone SE and 6S models in India in 2017 to avoid high importation tariffs. The Indian government has in recent years place high tariffs on imported smartphones while encouraging manufacturers in the country by reducing import rates for smartphone parts. Apple could be making this move to benefit from this ruling while increasing competition with other smartphone manufacturers.
Apple reportedly cut productions of the pricey iPhone X it launched last year, according to industry analysts, immediately it released the latest iPhone models: iPhone XR and XS, globally late in October. The company could restart the production of iPhone X older model through Foxconn in India where it’s using sales of cheaper models to win a fair share of the world’s fastest-growing major mobile phone market.
Apple’s deal with Foxconn could still change, though the full details remain unclear.
Foxconn has not responded to a request seeking confirmation that the company will invest $356 million in India’s second-richest state. The Taiwanese manufacturer said it would not comment on matters related to potential or current customers.
It is not clear if the deal will move any of the iPhone assembly from existing Foxconn factories elsewhere. There is no information if the production will include the production of any component in India or be confined to assembly only.
Apple last month recorded a shocking lower-than-expected in sales forecast for the season and that affected its components suppliers globally aside from crashing Apple’s stock to a record low this year.