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Apple Inc. (AAPL), Foxconn Again Rumored To Build iPhone In India

Apple Inc. (NASDAQ:AAPL) iPhone India

Apple Inc. is looking to break into the burgeoning smartphone market of India. The Cupertino-based firm is reportedly in talks with Foxconn to potentially manufacture iPhone in India, as per a report by The Economic Times. The report says the Silicon Valley giant is discussing the possibility of manufacturing a quantity of iPhone models at the Indian facilities of Foxconn.

No time-frame yet

The exact date for the production shift has not been settled yet, but the report estimates the change might come in the next two-three years. One of the sources told ET, “There’s definitely interest.” The source familiar with the matter added that the government raised the issue of making in India when Apple CEO – Tim Cook – was in the country. “It is after that that Apple started thinking of doing something in India which is long term,” concluded the unnamed source.Apple Inc. (NASDAQ:AAPL) iPhone India

Further, the report also talks about the previous rumors suggesting that Foxconn is planning to build a plant in the country just for Apple Inc. ’s products. Another production hub, a faster time to market and cheaper prices for locals are among the advantages of manufacturing in India. This may give the iPhone maker an opening to start retail stores in the country as well.

For years, the tech giant has sought the approval of the government to operate retail stores in India, but they have been stymied by the foreign direct investment trade policies. Indian trade laws require single-brand stores to source at least 30% of the goods from domestic suppliers, which means either Apple would become an exception, or it would be asked to begin producing its products in India.

India very important for Apple

To prove that Apple’s presence in India would add value to the country, Cook visited the country with some key executives in May. The team had a talk with local telecommunications companies on the iPhone partnerships. Cook met with PM Narendra Modi to talk manufacturing, retail, encryption and more. Shortly after that, the tech giant announced its plans to start a Maps development center in Hyderabad for Apple Apps, and setting up a development unit in Bengaluru, with an investment of $25 million.

Apple Inc. has been slow to emerge as a premium brand in the country. Last month, figures released by research firm Strategy Analytics showed that Apple’s share of the Indian smartphone market dropped 35% y-o-y to 2.4% during the quarter ending in June.

Analysts believe that if the Silicon Valley giant does local manufacturing, then it would allow the tech giant to bring products to the market faster and also cheaper for the Indian customers, which in result would turn the country into an export hub.

There has been no comment from Foxconn and Apple on the ET report.

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Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.

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