Foxconn Will Start Assembling High-End iPhones in India from 2019

iPhone X Body Shots 1

The Indian Commerce Minister was all set to meet Apple executives at Davos next month to discuss plans for setting up an iPhone manufacturing plant in India. However, it looks like things have moved forward faster than one expected. Reuters reports that Foxconn will start assembling high-end iPhones in India from 2019.

While Wistron already assembles iPhones for Apple in India, its assembly is limited to older models like the iPhone 6s and iPhone SE. Foxconn, however, intends on assembling newer high-end iPhones like the iPhone X at its plant in Sriperumbudur, Tamil Nadu. The Chinese company will be investing upwards of $350 million in its plant to expand its production capacity and create as much as 25,000 jobs.

Foxconn, which already makes phones for Xiaomi Corp in India, will invest 25 billion Indian rupees ($356 million) to expand the plant, including investment in iPhone production, Tamil Nadu’s Industries Minister M C Sampath told Reuters.

The terms of the deal can still change and it is entirely possible that Foxconn drops the idea of assembling high-end iPhones in India altogether. It is also unclear if Foxconn will only be assembling iPhones or also manufacturing some of their components in India. By setting up an iPhone production facility in India, Apple is looking to find a way to avoid itself from being a victim of the ongoing trade war between the US and China.

Our Take

The move will also allow Apple to be eligible for significant duty cuts which should lead to lowering of prices for iPhones which are assembled in India. Right now, due to high import duties, high-end iPhones are priced exorbitantly in the country. The iPhone XS Max, for example, is priced at almost twice the price of the Galaxy Note 9 despite both devices retailing for ~$1,000 in the US. By lowering iPhone prices in India, Apple could be looking to boost its sales in the country. With iPhone sales slowing down everywhere else, India is turning out to be an important market for Apple.

[Via Reuters]