Foxconn, the maker of iPhone, is planning to start an apple iPhone plant in India, i.e. the Apple’s iPhone will now be manufactured in India.
India will help Foxconn in mitigating the increasing wage inflation in China, (where the majority of iPhones are manufactured), as well as base production sites closer to the markets where its prominent clients want to flourish. The decrease in the production costs will, in turn help Foxconn to keep hold of Apple orders in the intensifying market competition scenario with various manufacturing rivals such as Quanta Computer.
Foxconn is aiming to develop and start 10-12 facilities in India that will include data centers and factories by 2020. But no detail has been provided yet.
Apple’s iPhone 6 with 16GB sells at almost Rs. 44,000 in India, whereas Samsung’s Galaxy S6 with 32GB sells at Rs. 40,000 ($625.29).
It has 10% market share in India, trailing Samsung, Micromax and other local manufacturers which dominate the Indian market.
Make in India
Return of Foxconn in India would be a major victory for India, as India badly needs to transform its tech boom into an employment and manufacturing boost.
India, under the supervision of Mr. Narendra Modi, has sought to reboot manufacturing, but it is yet to rival China, specifically in the technology field.
Local businessmen are betting that the suppliers will automatically follow when the global companies will invest in the country.
The biggest hurdles to manufacture technology products in india, is the lack of suppliers and good infrastructure. Thus, more than 100 different phone companies are forced to get their products from the markets of Taiwan and China.
Apple is one of the biggest clients for Foxconn which also makes various components for hi-end companies such as Acer, Xiaomi and Sony.
According to Sky Li, the vice president of phone manufacturer Oppo, The boom of smartphone in India indicates that it is the right time to focus on expansion plans and increase volume in the country to build a comparable level with the Chinese market in the upcoming 5 years.
India is only second to China in terms of the number of mobile phone accounts. According to reports, there will be around 650 million smartphones in India by the year 2019 and the number of tablets will rise to 18.7 million by then.