Report says Apple wants to build iPhone components in India

Local reports claim Apple in India is already generating millions at its stores.

iPhones may be trundling off the production line at Apple partner factories in India, but the smartphone maker also wants more components to be made there.

Building a supply chain beyond assembly

As reported by Benzinga, an insider from India’s government explained that at a July meeting with Apple the company stressed that it wants to get more components made in the country.

That’s significant, as it will also take a lot of work on supply chain management, but India seems to be declining to offer tax incentives to help enable the plan.

It is also interesting that the news follows a July report claiming Foxconn is investing in a component manufacturing facility, so the strands fit together well.

We know that Apple and its partners are investing deeply in the creation of a new manufacturing hub in India, in part to protect the company against increasing political fragmentation between global superpowers. Put simply, in complex times it makes sense to have a few eggs stashed inside multiple baskets.

A (very big) fistful of dollars

Apple’s investments in manufacturing in India mean its key partners have already spent billions to put in place iPhone manufacturing lines. I think (but estimates vary) that Apple hopes to see around 15% of all the smartphones sold worldwide made in India within the next 12 months, and that number is going to rise.

The challenge is that components aren’t made in India yet, and Apple wants to build resilience across its whole supply chain, not just at the assembly point.

We’ll take a look and see what happens next, but India’s recent decision to force an additional import tax on imported computers followed by a subsequent delay on putting that law into practise could be seen as demonstrating a continued dialog between Apple, other PC makers, and India on how they hope to move forward.

News around future component supply investment may hint at the depth of the conversation that is taking place.

Putting fleece in the nest

After all, when it comes to jobs while assembly may generate opportunities for thousands of people, manufacturing the bits and pieces used inside those things will inevitably create more, and tariffs on components could yet kill the golden goose that’s currently turning India into a tech industry powerhouse as our globalized and international society endures interesting times.

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