Apple is undertaking a significant strategic realignment of its global manufacturing operations, markedly increasing iPhone production within India. Recent reports, notably from Bloomberg's Mark Gurman, highlight a substantial surge in activity, with iPhones worth an estimated $22 billion assembled in India during the fiscal year ending March 2025. This represents a remarkable 60% increase in output compared to the previous year, underscoring India's rapidly growing importance in Apple's supply chain strategy. This expansion involves close collaboration with key manufacturing partners like Foxconn Technology Group and the Tata Group, signaling a deliberate move to diversify production capabilities beyond traditional hubs. The scale of this shift is substantial, with India now reportedly accounting for 20%, or one in five, of all iPhones assembled globally. The bulk of this production currently takes place at Foxconn's extensive facility in Tamil Nadu, which serves as Apple's primary manufacturing center in the country. Complementing Foxconn's efforts, the Tata Group has become an increasingly vital partner, now managing two significant plants—one in Tamil Nadu and another in Karnataka. This expansion for Tata includes taking over Wistron's former Indian operations and overseeing Pegatron's local business. These facilities are crucial for meeting both growing domestic demand and ambitious export targets, particularly for the lucrative US market. This significant ramp-up in Indian manufacturing is driven by several key strategic considerations, primarily the desire to mitigate geopolitical risks and reduce dependency on China. The ongoing trade tensions between the US and China, along with the potential threat of increased tariffs on goods imported from China, have incentivized Apple to seek alternative manufacturing locations. By shifting production of US-bound iPhones to India, Apple aims to preemptively address potential cost increases associated with tariffs, as India-made iPhones do not currently face these additional import duties. Reports indicate that shipments of iPhones from India to the US have already increased, potentially building reserves ahead of any future trade policy changes. Integral to this strategy is the development of a robust local supply chain within India. Apple has actively encouraged its global suppliers, many originating from China, Japan, and Taiwan, to establish manufacturing facilities in India. This initiative aims to localize the production of essential components, reducing reliance on imports and further embedding Apple's operations within the Indian industrial landscape. Key partners who have already begun local production include: Sunwoda (producing battery packs)Foxlink (manufacturing cables)Aequs (making enclosures) This localization effort is critical for sustaining the increased production volumes and enhancing overall supply chain resilience. Looking ahead, Apple has set ambitious targets for its Indian operations. The ultimate goal, projected for the end of 2026 or 2027, is to assemble the majority of the approximately 60 million iPhones sold annually in the United States within India. Achieving this would necessitate roughly doubling the current annual iPhone output in India to over 80 million units. To support this significant increase, both Foxconn and Tata Group are reportedly investing heavily in building new plants and expanding existing production capacities, particularly in southern India. This long-term commitment signifies more than just diversification; it represents a fundamental shift, positioning India as a central pillar in Apple's global manufacturing network and a primary hub for supplying one of its most critical markets.
