Apple has reached a significant milestone with its iPhone production, achieving a freight-on-board (FOB) value of $10 billion between April and October 2024.
The FOB value, which reflects the price at which the product departs from the factory gate, has increased by 37% from $7.3 billion during the same period last year, according to a report by Business Standard.
Export and Domestic Market Breakdown
Of the $10 billion FOB value, approximately $7 billion has been exported, while the remaining $3 billion serves the domestic market. The report noted that the estimated market value of this production is approximately $15 billion, factoring in sales, marketing, logistics, and margins.
Record iPhone Production in October
In October, Apple reached a historic milestone as iPhone production exceeded $2 billion in a single month for the first time. Since the introduction of the smartphone production-linked incentive (PLI) scheme in 2021, Apple has significantly scaled up its production in India.
Foxconn, Pegatron, and Wistron (now Tata Electronics) have set up large-scale production facilities in India to support this expansion. According to PLI scheme data, Foxconn’s Chennai factory alone contributed 56% of the $10 billion production value.
Key Production Insights
- October saw iPhone production exceed $2 billion for the first time.
- Apple has exported $7 billion worth of iPhones from April to October 2024.
- Foxconn’s Chennai facility is the largest contributor, accounting for 56% of India’s total iPhone production.
- Tata Electronics, which took over Wistron’s Karnataka plant, contributed 30% of the total production.
- Pegatron’s Tamil Nadu plant contributed the remaining 14%.
- Apple is targeting $18 billion in iPhone production for FY25, with an estimated market value of $25 billion.
PLI Scheme Success
Ashwini Vaishnaw, India’s Minister for Railways and Information Technology, highlighted the success of the smartphone PLI scheme, noting that India’s total smartphone exports crossed $10.6 billion in the first seven months of 2024. Additionally, the scheme has created over 175,000 new jobs, with 72% of these positions filled by women.
Impact on Employment and Economic Growth
Foxconn’s factory employs around 42,000 workers, with women making up 70% of the workforce. This factory is the largest in India in terms of employee numbers across all industrial sectors.
Tata Electronics has also ramped up production since acquiring Wistron’s plant 18 months ago. Pegatron’s Tamil Nadu factory continues to play a vital role in Apple’s production growth.
The smartphone PLI scheme has proven to be one of the most successful government initiatives, driving incremental duties and GST revenue. The India Cellular and Electronics Association (ICEA) recently reported that the scheme has contributed Rs. 1.1 trillion in duties and GST over the past four years.
Future Projections and Growth
Given the current pace, Apple is expected to exceed its $18 billion target for iPhone production in FY25. The estimated market value of the total production is anticipated to surpass $25 billion, further solidifying India’s role in Apple’s global supply chain.