Apple Said to First Make New iPhone from Ground up in India amid Pivot from China, following 33% of iPhone Export Jump

TMTPOST -- Recent reports showcased Apple Inc. keeps its low-profile pivot from China to India this year.

Credit：Apple CEO Tim Cook

Apple for the first time taps the Indian factory to do the early manufacturing work for the new iPhone, the Information reported, citing people with knowledge of the matter. It is reported that Apple chose a factory operated by Foxconn Technology Group located in the southern Indian city of Bangalore for the early stage development of the base model of next year’s iPhone 17. Such work, internally known as New Production Introduction (NPI), is the most challenging and resource-intensive aspect of Apple’s product development, according to the report.

The NIP involves tweaking the iPhone’s design and materials and experimenting with different types of equipment and manufacturing processes to ensure that millions of iPhones can be produced a day across different locations with minimal defects, per the report. It said that the development of the more complicated iPhone 17 Pro will still be conducted in China. If the work in Indian factory becomes a success, Apple will lock down the manufacturing steps of the iPhone 17 in India by next summer and begin replicating it at secondary sites like Zhengzhou, the capital of central China’s Henan province, where Foxconn operates the world’s largest iPhone factory, according to the report.

Bloomberg last week cited sources that Apple shipped nearly $6 billion worth of iPhones from India in the first half of the fiscal year ended September, marking a 33% increase from a year earlier. The iPhone maker is on course to top $10 billion in exports for the fiscal year with the explosive rise in exports. It is said that half of these shipments are attributed to Foxconn's local division. The first Indian business to build iPhones, Tata Electronics bought a manufacturing facility from Wistron Corp., shipping $1.7 billion in iPhones from its Karnataka plant from April to September.

Increasing signs these years signaled the company is stepping up shift to India. Apple announced in April 2022 to start making iPhone 13 in India, which seems as one of signs to highlight increasing importance of countries like India, Vietnam and Mexico for suppliers who try to improve diversification of production away from China. Five months later, Apple confirmed it was assembling iPhone 14 in India, less than three weeks from its release of the new iPhone series. The confirmation effectively admitted India for the first time to make the latest flagship iPhone.

Apple opened its first retail stores in India in July 2023, when Apple CEO Tim Cook first visited the country since 2016, then inaugurated the first store and met Indian Prime Minister Narendra Modi. The executive underscored commitment to growing and investing across the country, signaling an effort for refocus.

Cook singled India out after Apple posted its first third consecutive quarter of yearly decline in revenue since 2016. Cook said India is the second largest smartphone market in the world while Apple just has a very low and modest share there. “It’s a huge opportunity for us, and we’re putting all of our energies in making that occur,” he told analysts at an earnings conference on August 3, 2023.

Bloomberg reported in April that Apple’s India-based partners assembled iPhones worth of $14 billion in a fiscal year ended March 2024, doubling production. Sources of Bloomberg revealed as much as 14% of iPhones was made in India. That comes out to about 1 in 7 of Apple’s marquee devices made across the fiscal year. Foxconn Technology Group was reported to assemble nearly 67% and Pegatron Corp. about 17% of the India-made iPhones in the fiscal year, while the remaining iPhones were made in Wistron Corp.’s plant in southern Karnataka state, which the Indian conglomerate Tata Group took over last year. Tata plans to build one of the country’s biggest iPhone assembly plants.