Apple could significantly increase its iPhone production in India to over $30 billion annually within the next two years, according to The Economic Times.
Currently, Apple manufactures iPhones worth approximately $15-16 billion in India. If U.S. President-elect Donald Trump implements his campaign promise of imposing heavy tariffs on Chinese imports, India may become Apple’s primary manufacturing hub.
Impact of Trump’s Tariff Proposal
During his campaign, Trump proposed tariffs of 60% to 100% on imports from China, with which the U.S. has had ongoing trade disputes. The report suggests that if Trump enacts similar policies upon returning to the White House, Apple may respond by significantly increasing its production in India, positioning it as a leading manufacturer.
Growth of Premium iPhone Models in India
Counterpoint Research Vice President Neil Shah emphasized Apple’s shift towards producing premium iPhone Pro models in India. He noted that the demand for premium devices, coupled with local production, could drive Apple’s annual output to over $30 billion. According to the report, this shift in strategy supports Apple’s growth trajectory in India.
Apple’s Expanding Market Presence in India
According to Counterpoint, Apple currently holds a 6% share of India’s smartphone market. In 2023, Apple claimed 23% of the revenue share from smartphone sales, surpassing Samsung’s 21%. The company shipped over 10 million iPhones in India in 2023, a significant rise from 6 million in 2022, securing the top revenue position.
Challenges for Doubling Production
Experts quoted in the report highlighted that for Apple to double its iPhone production in India, the Indian government would need to address issues such as cost inefficiencies and policy uncertainties. Without reforms, Apple might consider shifting production from China to other nations, like Vietnam, instead of expanding in India.
Increased Job Creation and Economic Impact
Currently, India contributes about 12-14% to Apple’s iPhone supply chain, valued at around $15-16 billion. Should Apple expand production as anticipated, this figure could exceed 26%, potentially creating up to 200,000 jobs in India’s electronics sector.
In recent announcements, Apple revealed record-breaking revenue in India for the September quarter, as noted by Apple CFO Luca Maestri. Additionally, CEO Tim Cook shared plans to open four more Apple stores in India, with locations expected in Bengaluru, Pune, Delhi-NCR, and an additional outlet in Mumbai.
Potential Strain in India-China Trade Relations
While India’s electronics sector, especially iPhone manufacturing, stands to gain, increased production may impact trade relations with China. According to the report, an official noted that while India may face challenges in some areas, the growth in electronics manufacturing could bring substantial benefits.