Apple Supplier Foxconn Invests $500 Million to Expand Production in India
Apple supplier Foxconn has invested $500 million USD in its Indian subsidiary to increase its production capacity in the country, according to documents filed in the Taiwan Stock Exchange (via South China Morning Post).
The move comes as Apple urges its partners to accelerate plans to diversify the iPhone maker’s supply chain beyond China. Foxconn is Apple’s largest supplier, responsible for assembling most of the company’s iPhones.
Apple is putting a rush order on moving more production out of China on the heels of recent disruptions at the largest iPhone factory in the world, operated by Foxconn in Zhengzhou, China. Foxconn’s “iPhone City” plant remained in lockdown with strict anti-COVID measures for weeks, leading to worker unrest that broke out into violent protests and a mass exodus of employees.
While the lockdown in Zhengzhou was lifted last week, the disruption at Foxconn’s factory cost Apple an estimated $1 billion USD per week. Per one industry analyst, Apple is facing a production deficit of 15-20 million iPhone 14 Pro units in its biggest quarter of the year.
Apple’s current flagship models, the iPhone 14 Pro and iPhone 14 Pro Max, have a three-week wait time in the U.S. right now with delivery dates slipping well past Christmas.
India, alongside Vietnam and South Korea, is among Apple’s prime candidates for supply chain expansion.
Foxconn already has a manufacturing presence in India, with a plant in Sriperumbudur, Tamil Nadu, that used to assemble older iPhone models in previous years but graduated to making Apple’s latest and greatest, the iPhone 14 series, as well earlier this year.
With the $500 million infusion, Foxconn hopes to boost its production capabilities in India and increase its output as Apple looks to shift some of its supply chain’s weight from China toward other countries.
Foxconn is likely to first focus on raising iPhone yield from India to pick up the slack from Zhengzhou as the iPhone City plant ramps back up. That said, the company could later start assembling other Apple products, such as the iPad, in the country.