Apple is encountering challenges as it endeavors to increase its manufacturing output in India. The tech giant is facing issues with ramping up production in the country, according to a report by the Financial Times. According to previous reports, Apple has plans to shift 25% of its iPhone production to India by 2025.
In September 2022, Apple acknowledged that it had commenced manufacturing some of its iPhone 14 models in India shortly after the launch of the latest devices.
Earlier, in August 2022, reports emerged that Apple was in talks with two of its suppliers, Luxshare Precision Industry and Taiwan-based Foxconn (also known as Hon Hai Precision Industry Co Ltd), regarding manufacturing the Apple Watch and Macbook in Vietnam.
However, Apple has been producing less expensive iPhone models in India since 2017, initially through Wistron Corp, and later by Foxconn, as part of its efforts to support the Indian government’s push for local manufacturing.
Apple faces obstacles in move to India manufacturing
According to the Financial Times, Apple is facing production challenges in India. The company has been sending engineers and designers to train locals and help establish production in southern India.
However, recent experience has shown the significant work that needs to be done in the country. At a Tata-run casings factory in Hosur, just 50% of components are reportedly in good enough condition to be sent to Foxconn, Apple’s assembly partner for building iPhones.
The report says that the 50% yield at the Tata-run casings factory falls short of Apple’s zero-defect goal. Apple’s expansion in India has been slow due to logistics, tariffs, and infrastructure challenges. Two sources with knowledge of Apple’s offshore operations stated that the factory is working to improve efficiency, but the process will be long, the report adds.
Last month, India’s trade minister revealed that Apple intends to increase India’s share of its production from the current 5-7% to 25%.