Apple partner Foxconn has spent billions on India manufacturing
Media and analysts arrive at Apple’s iPhone event
While Apple now faces pressure from the Trump administration to build a manufacturing ecosystem in the US, rather than India, there are solid economic reasons why that won’t ever work – not least the sky high cost. In addition to which, Apple and its partners have already invested billions in India and have billions more they are about to put into US investments.
Billions invested so far
To get a sense of the scale of the investments that are being made, take a look at what Foxconn has spent building in India so far – a colossal $1.5 billion so far, Bloomberg reports.
That’s really not the kind of investment you can expect people to make on an ad hoc basis and comes as Foxconn also reveals big spending in the US as well.
Apple’s ecosystem is repositioning where it can, seeking places close to component and raw material supply that are also equipped with workers skilled enough to make those things.
Apple has increased iPhone manufacturing in India by 60% on previous years, with factories from Foxconn and Tata Electronics churning out iPhones. The company hopes to make all the iPhones sold in the US in India by the end of this year, previous reports have claimed.
However, none of this has come easy.
Planning takes care and rigor
None of these investments have been made on an ad hoc basis and the foundations to all of this growth in manufacturing capacity have taken years to build. These plans have been created with care and rigor, as they need to be with so much money involved.
At the end of the day, even if Apple wanted to migrate all production to the US it would be unable to do so, as the nation lacks the resources it needs, costs would be crippling, skills aren’t available, and the factories don’t exist.
Fixing all those problems would take many years, and the costs would be astronomical – costs which would then be passed onto consumers, creating further problems and denting the US tax base.
But it is interesting to get a sense of the degree of investment Apple’s partners are making in India, even while considering what the equivalent – far, far higher – cost of similar investments in the US might be.
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