Apple will begin producing its most expensive iPhone models, the Pro and Pro Max, in India this year, marking a significant milestone for both the company and India’s manufacturing sector.
According to Bloomberg, key partner Foxconn Technology Group is set to start assembling these premium devices within weeks of their global launch this fall. To meet this timeline, Foxconn has already started training thousands of workers at its factory in Tamil Nadu.
India’s Role in Apple’s Production Strategy
Apple’s decision to expand iPhone production in India is part of a broader effort to diversify its manufacturing base beyond China.
This shift gained momentum in 2021, supported by financial incentives from Prime Minister Narendra Modi aimed at attracting high-end manufacturing to India.
Despite this move, China remains the primary hub for iPhone production, but Apple is gradually reducing its reliance on the country due to geopolitical tensions between Beijing and Washington.
Significant Contribution to Global Output
In the fiscal year ending March 2024, Apple assembled $14 billion worth of iPhones in India, accounting for up to 14% of its global output. This year, Apple plans to launch the India-made standard iPhone 16 simultaneously with its global release.
Additionally, other partners in India, such as Pegatron Corp. and Tata Group, might also begin producing the Pro models soon, which require more specialized production lines due to their advanced features like bigger batteries, better cameras, and titanium bodies.
Local Demand and Pricing Strategy
By year’s end, iPhones made in India are expected to meet local demand, potentially reducing the prices of Pro models by up to 10% due to exemption from import duties.
However, the iPhone 16 Pro and Pro Max will still cost more in India than in some other markets because of high component import costs and local taxes.
Most India-made Pro models will be exported to Europe, the Middle East, and the US, where demand is higher. As the price gap between local and imported iPhones narrows, more Indian consumers are expected to buy domestically, especially with financing options available during festive seasons.
This shift aligns with Apple’s growing focus on the Indian market, where sales have surged by 33%, reaching nearly $8 billion. India’s rising middle class and payment plan usage could drive sales to $33 billion by 2030.
Further details are expected as the global launch of the iPhone 16 series approaches next month.