Apple is ramping up its efforts to reduce reliance on China, reporting nearly $6 billion in exports of India-made iPhones from April to September 2024. This marks a significant one-third increase compared to the same timeframe last year, positioning the tech giant to surpass $10 billion in exports by the fiscal year’s end.
The expansion of Apple’s manufacturing base in India is driven by local subsidies, a skilled workforce, and the country’s technological advancements. With increasing geopolitical tensions between Beijing and Washington, India is emerging as a crucial player in Apple’s strategy to diversify its production operations.
Three key suppliers—Foxconn Technology Group, Pegatron Corp., and India’s Tata Electronics—are pivotal in assembling iPhones in southern India. Foxconn’s facility near Chennai is particularly significant, accounting for approximately half of India’s iPhone exports. Meanwhile, Tata Group has established itself as a major contributor, producing around $1.7 billion worth of iPhones at its Karnataka plant since taking over the facility from Wistron Corp. last year, becoming the first Indian company to assemble Apple’s flagship devices.
Smartphone Exports Surge
Apple’s growing production in India has transformed the country’s smartphone export landscape, with iPhones now leading as the top product category shipped to the US. In the first five months of the fiscal year, smartphone exports to the US reached $2.88 billion, a remarkable jump from just $5.2 million five years ago, prior to Apple’s local manufacturing expansion.
While Apple holds less than 7% of India’s smartphone market—dominated by Chinese brands like Xiaomi, Oppo, and Vivo—the company is banking on India’s burgeoning potential. With support from Prime Minister Narendra Modi’s government, Apple has begun producing high-end models like the iPhone 16 Pro and Pro Max in India for the first time.
Retail Expansion on the Horizon
In addition to boosting manufacturing, Apple is expanding its retail presence in India. Following the opening of flagship stores in Mumbai and Delhi in 2023, the company is now eyeing new locations in Bangalore and Pune. These efforts, combined with aggressive online sales tactics and a growing middle class eager for Apple products, have helped elevate Apple’s India revenue to a record $8 billion in the year ending March 2024.
Contrasting Markets
Apple’s growth trajectory in India sharply contrasts with its slowing momentum in China, where economic challenges post-COVID-19 and a property crisis have hampered sales. Despite this, China remains a vital market for both manufacturing and sales, and India is not expected to replace it as Apple’s primary market in the near future.
In the fiscal year ending March 2024, Apple assembled $14 billion worth of iPhones in India, doubling its production from the previous year. With around $10 billion worth of these devices exported, the company is clearly accelerating its efforts to shift some operations from China, tapping into India’s potential as a manufacturing hub.
