India is expected to assemble up to 50 per cent of Apple’s iPhones by 2027, up from fewer than 5 per cent at present, to be on par with the scale of production in mainland China, according to a new report.
“The speed of supply chain migration to India will be accelerated in the future because of the need to diversify risks in light of uncertainties in China’s pandemic control,” said Luke Lin, analyst at the research unit of tech-focused Taiwanese daily newspaper DigiTimes, in a report published on Tuesday.
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India, which surpassed the UK last year to rank as the world’s fifth-largest economy, is already predicted to account for up to 25 per cent of total iPhone production by the end of 2023, and as much as 40 per cent by 2025, the report said.
China, where up to 85 per cent of iPhones globally were produced last year, is at risk of losing its dominant role as a manufacturing hub for Apple devices because of US-China decoupling moves, according to Lin. He expected India and Vietnam to be “the biggest beneficiaries” of Apple’s efforts to shift more of its manufacturing supply chain outside China.
The DigiTimes Research forecast is more aggressive than JPMorgan’s earlier prediction that India would assemble 25 per cent of total iPhones worldwide by 2025.
Taiwan-based Foxconn Technology Group, formally known as Hon Hai Precision Industry, has been one of the most aggressive Apple contractors to bolster its efforts in India. The world’s largest electronics contract manufacturer in December made a US$500 million cash injection into its Indian subsidiary, Foxconn Hon Hai Technology India Mega Development.
Other major smartphone brands are also increasing their production outside China, according to the DigiTimes report.
Samsung Electronics (https://www.scmp.com/topics/samsung-electronics?module=inline&pgtype=article), for example, has been shifting more of its Android smartphone manufacturing capacity out of China since 2019, primarily to Vietnam.
Samsung smartphone production in China is projected to cease in the next five years, according to the report, as Vietnam and India’s share of assembly work approaches 35 per cent to 40 per cent and 40 per cent to 45 per cent, respectively, by 2027.
source: SCMP
