Apple partner Foxconn to invest $1.6 billion in India.

The ever-changing supply chain sees more news from India as Apple manufacturing partner HonHai/Foxconn announces plans to invest $1.6 billion in building new plant in India.

Hon Hai goes high in India

The company didn’t tell us anything much about its plans in a regulatory filing in Taiwan, but it really does confirm the intensity with which Apple partners are investing in India. The company already has nine production campuses and over 30 factories in India and employs thousands of people.

Now it wants to double its business in India.

This is the latest in a fast-paced range of investments to come out of Foxconn. In summer, it announced plans to invest $600 million in two component factories, one to make iPhone enclosures, while the other makes semiconductors. The company is also building a new iPhone factory in Bengaluru.

Thousands of jobs

While it isn’t at all clear if the $1.6b headline figure includes those previously announces investments, the news still reflects the colossal scale of investment being made in the tech industry production chain in India. What the company has said is that this latest investment will be to fulfil its “operational needs”. It has also described the investment as meaning it will hire 10,000 more workers in India.

India powers up PC manufacture

The news follows the India’s government approving new subsidies for Foxconn and 26 other tech hardware firms under its Production Linked Incentive scheme. This aims to boost domestic manufacturing and transform India into a giant tech industry production hub. This new subsidy seems to relate to manufacture of computers, tablets, and other hardware. Similar subsidy arrangements were reached last year to help boost smartphone production in India, which directly benefitted the Apple supply chain. It is now not at all impossible that some future iPads may be manufactured in India, though this is not yet the case.

Apple’s journey to India

When it comes to iPhone production in India, Apple continues working to build up its business there. The company aims to product nearly 1 lakh crore worth of iPhones in India by March 2024 (which I think is around $25b). It is also expected to sell 9-10 million iPhones in India in 2024, compared to under 7 million in 2023.

Speaking on India during a recent fiscal call, Apple CEO, Tim Cook, said: “We have low share in a large market and so it would seem that there’s a lot of headroom there… We see an extraordinary market—a lot of people moving into the middle class… Lots of positives, we put two retail stores there and they are doing better than we anticipated—it’s still early going but they are off to a good start and I couldn’t be happier with how things are going at the moment.”

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