Three of Apple’s suppliers — Taiwan’s Foxconn Technology Group, Pegatron Corp., and homegrown Tata Electronics — assemble iPhones in southern India.
Apple Exports $6 Billion of iPhones from India, Marking Major Shift from China..
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The US company exported nearly $6 billion of India-made iPhones, an increase of a third in value terms from a year earlier.
Apple Inc. has seen a significant increase in its iPhone exports from India, which rose by one-third during the six-month period ending in September. This growth highlights the company’s strategy to enhance its manufacturing presence in India while decreasing its reliance on China.
According to sources who requested anonymity due to the confidential nature of the information, the US firm exported nearly $6 billion worth of iPhones produced in India, marking a 33% increase in value compared to the previous year. This trend suggests that annual exports are likely to exceed approximately $10 billion for the fiscal year 2024.
The company is rapidly expanding its manufacturing operations in India, capitalizing on local incentives, a skilled labor force, and improvements in the nation’s technological infrastructure. India plays a vital role in Apple’s initiative to reduce its dependence on China, especially in light of the increasing risks associated with the geopolitical tensions between Beijing and Washington.
Three suppliers of Apple—Foxconn Technology Group from Taiwan, Pegatron Corp., and Tata Electronics from India—are engaged in the assembly of iPhones in southern India. The local branch of Foxconn, situated on the outskirts of Chennai, stands as the leading supplier in the country, responsible for half of India’s iPhone exports.
The electronics manufacturing division of Tata Group reported exports of approximately $1.7 billion in iPhones from its facility in Karnataka state between April and September, according to sources. Tata acquired this operation from Wistron Corp. last year, marking its position as the first Indian assembler of Apple’s flagship product.
The mentioned dollar amount reflects the estimated factory gate value of the devices rather than their retail price. Apple representatives chose not to provide comments, and while Pegatron also refrained from commenting, spokespersons from Foxconn and Tata did not respond to inquiries.
iPhones represent a significant portion of India’s smartphone exports, contributing to the category becoming the leading export to the United States, valued at $2.88 billion in the first five months of the current fiscal year, as reported by federal trade ministry data. In contrast, five years prior, before Apple expanded its manufacturing operations in India, the country’s annual smartphone exports to the US were a mere $5.2 million.
Apple currently holds a market share of just under 7% in India’s smartphone sector, which is primarily led by Chinese manufacturers such as Xiaomi, Oppo, and Vivo. Although the iPhone market remains relatively small on a global scale, Apple is making significant investments in this region.
The subsidies provided by Prime Minister Narendra Modi’s government have enabled Apple to assemble its high-end iPhone 16 Pro and Pro Max models, featuring enhanced cameras and titanium bodies, within India this year. Additionally, the company is planning to establish new retail locations, including in the southern technology hub of Bangalore and the western city of Pune.
Last year, Chief Executive Officer Tim Cook inaugurated Apple’s first retail outlets in Mumbai, the financial capital, and New Delhi, the national capital.
The grand openings, coupled with an extensive marketing campaign for the new stores, a vigorous online sales strategy, and a rapidly expanding middle class eager to purchase Apple products, have contributed to a record annual revenue of $8 billion in India for the fiscal year ending in March.
What Bloomberg Intelligence Says
India’s sales are projected to reach $33 billion by 2030, driven mainly by the increasing purchasing power of the middle class and a higher adoption of payment plans.
Apple’s growing prominence in India stands in stark contrast to its declining performance in China, where the economy has struggled due to severe Covid-19 lockdowns and a real estate crisis. It is important to note that Apple heavily depends on China for a significant portion of its manufacturing and sales, and it is unlikely that India will surpass China as its leading market in the near future.
In the fiscal year ending March 2024, Apple produced $14 billion worth of iPhones in India, marking a twofold increase in production as the company seeks to reduce its reliance on China. Of this total, approximately $10 billion worth of iPhones were exported.
