A view of the new iPhone 14 at an Apple event at its headquarters in Cupertino, California, September 7, 2022.
Carlos Barria | Reuters
Apple said on Monday that it is assembling its flagship iPhone 14 in India as the US tech giant is looking to move some production out of China.
“The new iPhone 14 lineup introduces groundbreaking new technologies and critical safety capabilities. We are delighted to manufacture iPhone 14 in India,” the company said in a statement.
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Apple’s main iPhone assembler, Foxconnis manufacturing the equipment at its Sriperumbudur factory on the outskirts of Chennai.
The Cupertino, California giant has been making iPhones in India since 2017 but these are usually older models. This time with the iPhone 14, Apple made its latest model in India for the first time, close to the time the device was launched. Apple introduced the iPhone 14 earlier this month.
Apple will sell phones made in India locally but also export them to other markets around the globe. Customers in India will start receiving locally made devices in the next few days.
JPMorgan analysts said in a note this month that Apple will move 5% of global production for the iPhone 14 to India by the end of 2022. Apple could also produce 25% of all iPhones by 2025. in India, JPMorgan said.
Apple’s focus on manufacturing in India highlights the tech giant’s desire to diversify production away from China and boost customers in India, which is currently a small market for the company.
Apple still relies heavily on China for the majority of iPhone production.
But Beijing persisted with its lockdown strategy to control the resurgence of the Covid-19 outbreak even as most of the world sought to reopen their societies. The Covid-free policy has disrupted production at factories across China, where the shutdowns have taken place, and highlighted some potential weaknesses in Apple’s supply chain.
India has sought to boost domestic electronics production through incentives.
Meanwhile, Apple is looking to boost sales in India, the world’s second-largest smartphone market. Apple accounted for just 3.8% market share in India last year, due to lower-cost competitors like Samsung and China. Xiaomi continues to dominate, according to Counterpoint Research.
However, Apple is the best-selling brand in the ultra-premium segment, being a phone above 45,000 Indian rupees ($552) in the second quarter of this year. That’s thanks to the strong momentum of previous-generation iPhone 13 models.
The iPhone 14 starts at 79,900 rupees ($980).
“Apple is gaining momentum in India. India is among the more than 20 countries in the world where the luxury trend is just starting,” Tarun Pathak, research director at Counterpoint Research, told CNBC. .