In preparation for the festive season demand in the US and Western markets, Apple is gearing up its production efforts despite decline in gadget consumption in Western countries due to global economic challenges.
Apple aims to achieve the production of INR 1 lakh crore (US$ 12 billion) worth of iPhones, by March 2024 .The company has already ramped up its production capacity, having manufactured over INR 60,000 crore (US$ 7.19 billion) worth of iPhones in the first seven months of the current fiscal year. If Apple falls short of reaching the target this fiscal year, it is expected to hit this goal in the first quarter of FY25.
A significant portion of Apple’s India-made iPhones, around 70%, are for export. From April to October this fiscal year, the company exported iPhones worth INR 40,000 crore (US$ 5 billion), making the iPhone the first single brand to surpass US$ 5 billion in exports from India in FY23. This marks a 185% year-over-year increase in exports, compared to INR14,000 crore (US$ 1.67 billion) exported in the same period last year.
Besides exports, Apple is also capitalizing on the growing premium segment in India’s domestic market. The company is expected to sell a record 9-10 million iPhones in India in 2024, up from less than 7 million in 2023. Additionally, Apple plans to start producing AirPods at Foxconn’s facility in Hyderabad by December 2024.
Apple’s manufacturing operations in India are managed by Foxconn and Pegatron in Tamil Nadu and Wistron (now part of the Tata Group) in Karnataka, under the production-linked incentive (PLI) scheme for smartphone manufacturing. Wistron Hong Kong recently sold its entire equity stake in Wistron Infocomm Manufacturing (India) to the Tata Group, making the latter the first Indian entity in Apple’s iPhone manufacturing supply chain.
Since 2018-19, Apple has been progressively focusing on India for iPhone production. Initially, the company tested the market with limited production of iPhone SE, 7, and 8 models, thoroughly assessing aspects like skilled labor availability.