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Your Apple iPhone XR is now 'Made in Chennai'

October 23, 2019 15:22 IST

The development comes at a time when growing tension in US-China trade ties is forcing companies to explore alternative manufacturing sites in order to derisk operations.

Apple, the multinational technology major, has started assembling its top-end iPhone XR model, launched last year, in India.

This is being done near Chennai, through the unit of Taiwanese electronics manufacturer Foxconn.

 

The development comes when growing tension in US-China trade relations is forcing companies to look at alternative locations, to de-risk their manufacturing.

There was speculation that manufacturing locally might reduce the cost of production and reduce prices.

However, says an expert, this is only an assembling of imported components and would not significantly reduce cost.

Josh Foulger, managing director at Foxconn India, and the Apple spokesperson would not offer a comment.

Foxconn already makes mobile phones for Chinese entity Xiaomi; sources say it invested at least Rs 2,500 crore in Tamil Nadu for making electronic products, including mobile phones, at its Sriperumbudur unit (40 km from Chennai).

In 2017, Apple started assembling its iPhone SE and in 2018, the iPhone 6S, at Taiwanese firm Wistron's Bengaluru plant.

Earlier this year, it started manufacturing the iPhone 7 at the Foxconn facility.

The SE is no longer assembled in India but the other two models continue to be.

The news comes as a booster for Tamil Nadu, once the global hub of erstwhile mobile phone major Nokia; its feature phones were also made at Sriperumbudur.

The Special Economic Zone (SEZ) where it was located, which had various component makers, including Foxconn, was hit by a Rs 21,000-crore demand from the income tax department.

This, and sale of its global mobile phone business to Microsoft, led Nokia to suspend operations at the factory.

Around 8,000 workers who were directly employed  (60 per cent women) and another 21,000 who were indirectly employed lost their jobs.

Foxconn later set up a mobile phone manufacturing unit at Sri City, in Andhra Pradesh, close to Chennai.

The company has started other facilities in Tamil Nadu and has been looking at reviving the mobile phone and related manufacturing operations in the state.

Earlier this year, the state government said Tamil Nadu ranked second in India on manufacture of computer, electronic and optical products, accounting for 16 per cent of national production, after Uttar Pradesh.

The state ranked third in India on electronics export ($1.27 billion) in 2017-18.

It has two sector-specific SEZs for the electronics and hardware sector in Kancheepuram district, a 486 acre electronic/telecom hardware  SEZ at Sriperumbudur and a 348 acre electronic hardware hi-tech SEZ at Oragadam, also close to this city.

India has emerged as a location for more mobile phone assembling, a central government initiative after talking with the industry.

Local manufacturing of various components were promoted over the years.

According to reports, India recently overtook Vietnam to become the world’s second largest maker of mobile phones, manufactured across 268 assembling units.

Photograph: Stephen Lam/Reuters

T E Narasimhan in Chennai
Source: source
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