Apple has started assembling the iPhone 14 models in India, it said Monday, locally producing the current lineup for the first time in the same calendar year in the world’s second largest smartphone market as analysts predict a greater shift in the American giant’s future manufacturing.
The company’s global partner Foxconn is manufacturing the device in the Sriperumbudur facility near Chennai. The locally produced iPhone units will go on sale in the country later this year. “We’re excited to be manufacturing iPhone 14 in India,” an Apple spokesperson told TechCrunch in a statement.
Apple began locally assembling smartphones in India in 2017, but until this year, the iPhone-maker has used the manufacturing facilities in India to assemble older generation handsets. Apple launched the iPhone 14 models earlier this month.
Analysts estimate that Apple will turn India into a global iPhone manufacturing hub by 2025 as it slowly cuts its reliance on China, where it has been producing the vast majority of its devices for over a decade. In a report earlier this month, JP Morgan analysts said Apple will move 5% of global iPhone 14 production to India by late 2022 and expand its manufacturing capacity in the country to produce 25% of all iPhones by 2025.
India has attracted investments from Apple manufacturing partners Foxconn and Wistron in recent years by offering lucrative subsidies as New Delhi moves to make the country a manufacturing hub. The presence of the foreign production giants, coupled with “ample labor resources and competitive labor costs,” make India a desirable location, JP Morgan analysts said.
“India’s iPhone supply chain has historically supplied only legacy models. Interestingly, Apple has requested that EMS vendors manufacture iPhone 14/14 Plus models in India in 4Q22, within two to three months of the start of production in Mainland China. The much shorter interval implies the increasing importance of India production and likely higher iPhone allocations to India manufacturing in the future,” the report added.
“We believe Apple only produces iPhone 14/14 Plus models in India now due to the more complex camera module alignment of the iPhone Pro series (done by EMS vendors) and higher local market demand for the iPhone 14 series (tax savings). We expect the volume to start small in 4Q22 (~1M units per month, or 5% of total iPhone volume).”
As Apple expands its local manufacturing capacity in India, many will hope that it will make its handsets affordable in the country. The base iPhone 14 model, which is priced at $799 in the U.S., costs 79,900 Indian rupees ($980). Whereas the entry iPhone Pro Max model costs $1,717 in India, compared to its $1,099 sticker price in the U.S.
Even as Apple commands a tiny market share in India, the iPhone-maker has broadened its investment in the country in the past five years. It opened its online Apple Store in the country two years ago and has publicly shared that it’s working to launch its first physical store in the nation.
Apple-rival Samsung already identifies India as a key global manufacturing hub and has set up one of its largest factories in the country. Chinese smartphone maker Xiaomi, which currently leads the market, as well as its rivals Oppo, Vivo and OnePlus also locally assemble a number of their handsets in the country.
Google also plans to move some of Pixel smartphones’ production to India, The Information reported recently. The company, which skipped shipping flagship models in India for two generations, said last week that it will launch the upcoming Pixel 7 models in India.