Apple supplier Foxconn plans 2 new component plants in India, spending US$500 million to build out footprint
- One factory the Taiwanese company plans to construct in the southern Karnataka state will produce Apple parts, including for iPhones, sources told Bloomberg
- Foxconn has been seeking to diversify manufacturing away from China, with India being one of the biggest beneficiaries
At least one of the factories that the Taiwanese company plans to construct in the southern Karnataka state will produce Apple parts, including for iPhones, people familiar with the matter said. A formal announcement is expected as early as this week, the people said, declining to be named as the matter is not public.
The exact location of these new plants is yet to be decided.
In a blow to Modi’s chip dream, Foxconn exits US$20 billion Indian joint venture
Apple did not immediately reply to a request for comment. Foxconn, formally known as Hon Hai Precision Industry, did not respond to an email for comment.
The Karnataka state government did not respond to a request for comment outside of business hours.
Separately, Foxconn has also signed an initial agreement with the southern Tamil Nadu government to set up a component plant with an investment of 16 billion rupees (US$195 million), the state’s industries ministry said Monday. The project planned at Kancheepuram district is likely to generate about 6,000 jobs.
Apple suppliers such as Foxconn have ramped up business in India over the past few years thanks to Prime Minister Narendra Modi’s incentives to boost local manufacturing. States such as Karnataka have also wooed companies with quick decision making, cutting down on red tape and throwing in subsidies.
Foxconn’s moves in India highlight how the South Asian nation has fast become a popular destination for manufacturers scouting for an alternative to China amid growing tensions between Washington and Beijing. It’s also the result of a shift in the global supply chain that accelerated during the Covid-19 pandemic and the war in Ukraine, and could reshape the way electronics are made.
02:23
iPhone 14 delays expected after days of violent protests at Foxconn Zhengzhou factory
The new component factory plans are in addition to US$700 million that Foxconn is investing to build a plant on a 300-acre site close to the airport in Bengaluru, the capital of Karnataka, Bloomberg previously reported. The plant is likely to assemble iPhones and expected to create about 100,000 jobs.
Foxconn’s sprawling iPhone assembly complex in Zhengzhou, capital of central Henan province and currently the world’s biggest source of Apple’s marquee gadget, employs some 200,000, though that number surges during peak production season.
Output at the Zhengzhou plant plunged ahead of the year-end 2022 holidays due to Covid-19-related disruptions, one of several factors spurring Apple to re-examine its China-reliant supply chain.
Foxconn’s decision suggests suppliers may move capacity out of China far faster than expected. That is a coup for Modi’s government, which sees an opportunity to close India’s tech gap with China as Western investors and corporations sour on Beijing’s volatile regulations, slowing economy and US trading restrictions.
