Apple has started adding more iPhone 14 products in India through manufacturer Pegatron Corp.
Taiwanese electronics maker Pegatron Corp. has been added as an additional production source for the latest iPhone 14 model along with one of Apple’s largest suppliers along with Foxconn and Wistron Corp. Bloomberg reports that the added Pegatron factory is also being boosted by Indian Prime Minister Narendra Modi’s financial incentive program.
According to bbc newsApple has already transferred five percent of its iPhone 14 to India and plans to have the country produce at least a quarter of all its iPhones by 2025. Apple is currently in the process of diversifying its supply chains by adding more manufacturers outside its main source, China.
India is the latest addition to Apple’s other manufacturing countries, all of which fall under manufacturers Foxconn and Pegatron, including China, the Czech Republic, Malaysia, Thailand and South Korea.
Drop in production of Apple products in China due to COVID surge
As of now, Apple still relies heavily on China for the majority of its iPhone production. However, Apple has added manufacturers in India as a plus one strategy to offset the decline its manufacturers in China are seeing due to COVID-19.
Reuters reports that Apple’s iPhone makers in China will see a 30% drop in production rate due to the COVID outbreak and strict health protocols for factory workers. Considering China’s response to COVID, the management of its local factories aims to prioritize the health and safety of employees rather than Apple’s supply chain. Foxconn’s factory, located in Zhengzhou, China, was recently shut down, with some of its employees even trying to flee the factory.
So the move to add India as one of Apple’s manufacturing sites is a way to diversify away from its core manufacturer while also ensuring a stable supply chain for the latest iPhone 14.
Indian demand for Apple’s iPhone 14
Furthermore, the move comes after the demand for the iPhone 14 increased among the citizens of India. According to Inc42, stores across Delhi NCR have complained about declining stocks of the latest iPhone 14 Pro and Pro Max since their launch. Due to a lack of production, black market sales of the iPhone 14 Pro and Pro Max from alternative supply chains have reportedly increased.
However, to address the issue in India, the Minister of State for Electronics and IT, Rajeev Chandrasekhar, stated in a previous tweet that they have spoken with Apple about the issue and are seeking to improve the production of Apple products in his country.
I spoke to Apple and they told me that while demand for iPhone 14 is also being met by products from India, demand for iPhone 14 Pro has increased and faces supply constraints which they are addressing.
Pvt sales are probably “alternative” supply channels. https://t.co/wLxJdxbFi9
— Rajeev Chandrasekhar 🇮🇳 (@Rajeev_GoI) October 26, 2022
Therefore, Prime Minister Narendra Modi weighed in on the production issue by supporting Apple’s manufacturing solution in India, offering Pegatron a financial incentive program to increase iPhone exports.
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Written by: Andy C.
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