Apple’s Strategic Shift: Foxconn Launches AirPods Production in India

In a significant move, Foxconn, the renowned Taiwanese contract manufacturer, has officially kicked off production of Apple AirPods at its Hyderabad facility. This development comes amidst escalating US-China trade tensions, prompting Apple to bolster its manufacturing presence in India. As global tariffs on certain Chinese goods soar above 100%, India is being positioned as a key alternative manufacturing hub for Apple.

Expansion of iPhone Production Facilities

Sources indicate that Foxconn’s larger plant in Bengaluru is set to commence operations soon, which will further enhance iPhone production capabilities within India. This strategically timed expansion is part of Apple’s broader plan to reduce reliance on Chinese manufacturing, thereby ensuring supply chain stability and potentially mitigating rising iPhone prices.

• Key Highlights:
  • Production of AirPods in Hyderabad has begun for export.
  • The Bengaluru facility will significantly contribute to iPhone exports.
  • The new plant aims for a peak capacity of 20 million units annually.

Investment and Growth in India

The Bengaluru site, located in Devanahalli, represents Foxconn’s second-largest manufacturing facility outside of China, supported by a substantial investment of $2.8 billion (approximately ₹25,000 crore). Notably, trial production for the upcoming iPhone 17 series has already been initiated in India. Foxconn is not the only player; Tata Electronics is also engaged in producing components for Apple’s new lineup.

According to insiders, Tata Electronics’ new factory in Hosur has already started assembling older-generation iPhones, with shipments expected to commence shortly. This collaboration makes Tata Electronics Apple’s second crucial supplier in India, following Foxconn’s lead and acquiring facilities from Taiwanese manufacturers Pegatron and Wistron.

Apple’s Ambitious Production Goals

Apple has set an ambitious target to shift production of over 60 million iPhones annually to Indian factories by the end of 2026, aiming to meet all US demand. To date, the company has ramped up its production efforts significantly, marking a record shipment of iPhones worth $2 billion to the US in March—an achievement for both Foxconn and Tata Electronics.

Navkendar Singh, Associate Vice President at IDC India, stated, “These strategic moves are essential for scaling production in India. They aim to reduce dependency on China, especially in light of high tariffs on Chinese goods entering the US market.” With increased production capabilities, Apple is poised to meet the high demand from the US, its largest market.

Conclusion

As Foxconn and Tata Electronics forge ahead with their manufacturing initiatives in India, the tech giant Apple is strategically positioning itself to navigate the complexities of global trade dynamics. This shift not only strengthens Apple’s supply chain but also bolsters India’s role as a key player in the global technology manufacturing landscape.