Tata's New iPhone Factory to Accelerate Apple's India Expansion
Tata Group, a conglomerate, intends to establish a significant iPhone assembly plant in India, aligning with Apple Inc.'s push to expand manufacturing within the South Asian nation. As per sources familiar with the matter, Tata aims to build this factory in Hosur, located in the southern state of Tamil Nadu. The facility is expected to encompass roughly 20 assembly lines and provide employment to around 50,000 workers within a span of two years, although the individuals, who preferred anonymity while discussing undisclosed plans, disclosed this information. The objective is to have the site operational within a timeframe of 12 to 18 months.
The establishment of the plant would fortify Apple's drive to localize its supply chain and deepen its collaboration with Tata, which currently operates an iPhone factory acquired from Wistron Corp. in Karnataka, a neighboring state. Apple is diversifying its operations from China by partnering with assembly and component manufacturing firms in India, Thailand, Malaysia, and other locations. An Apple spokesperson declined to provide a comment, and there was no response from a Tata representative when requested for a comment.
The Indian conglomerate has taken strategic measures to expand its association with Apple and extend beyond its traditional businesses, spanning from salt to software. It has expedited the hiring process at its existing Hosur facility, primarily focused on manufacturing iPhone enclosures or metal casings. Additionally, Tata has announced plans to launch 100 retail stores dedicated to Apple products. Meanwhile, Apple has opened two stores in the country and has plans for three more.
Under Prime Minister Narendra Modi's production-linked incentives, significant Apple suppliers like Taiwan's Foxconn Technology Group and Pegatron Corp. have increased their presence in India. This has facilitated Apple in assembling iPhones worth over $7 billion in India during the previous fiscal year, raising the country's share in iPhone production to approximately 7%. Previously, all iPhones were manufactured in China.
The new plant is anticipated to be of moderate size among global iPhone factories. It is likely to surpass Tata's Wistron-acquired facility, which employs over 10,000 individuals, but smaller in scale compared to Foxconn's vast facilities in China, which employ hundreds of thousands. Apple and Tata may seek government subsidies for the new factory as it is projected to commence production as previous state-backed financial incentives are approaching expiration.