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With iPhone 12, Apple to shift 7-10% capacity from China

Apple Inc. will manufacture Made-In-India iPhone 12 soon, its latest model launched in India on October 30 last year, a few weeks after the global release.

iPhone 12, according to sources in the know, will be manufactured at the Hon Hai Precision Industry (Foxconn) facility in Tamil Nadu — both for the domestic as well as well as the export market.

The unit also manufactures iPhone 11, which is the bestseller in India, as well as iPhone XR. An Apple India spokesperson did not respond to a query on the issue.

Apple Inc. has tied up with three global vendors — Foxconn, Pegatron, and Wistron — under the production-linked incentive scheme to manufacture in India with huge commitments to export.

Currently, Wistron and Foxconn are in operation in India, while Pegatron’s unit is expected to come up sometime in the middle of next year, say sources.

According to analysts, Apple Inc. is expected to shift 7-10 per cent of its capacity from China.

The company has been facing labour problems at its Wistron plant in December and January, leading to an impact on production in the facility, which was manufacturing Apple SE 2000, launched globally in April 2020.

Analysts say it was also supposed to manufacture Apple iPhone 12 Mini, but no final call on this has been taken. Experts point out that the demand for the product has been limited.

Apple Inc. Chief Executive Officer Tim Cook has been bullish on the Indian push of the company. Talking about Apple India’s performance on January 28 on its December-quarter performance, he said: “India is one of those (countries) where our share is quite low.”

“It did improve in the year-ago quarter. Our business doubled over that period of time. And so we feel very good about the trajectory. We are doing a number of things in the area. We put the online store there, for example, and the last quarter was the full quarter of the online store,” he added.

Apple Inc., according to industry estimates, sold 1.8 million phones between October 2019 and September 2020. However, in the quarter ended December 2020, it sold over 1 million in India. Apple iPhone 12 is retailed at Rs 76,400 for a 64 GB phone and Rs 83,400 for a 128 GB phone. It includes basic Customs duty of 32 per cent, apart from GST. Experts say the price might not fall due to manufacturing immediately but would after enough capacity is built.

The article is authored by Surajeet Das Gupta, Business Standard


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