(PresidentialWire.Com)- Apple has long used factories in China to make its products. Famously, Apple manufactures its iPhones at Foxconn plants that can handle manufacturing on a gigantic scale, for its millions of iPhones sold every year, at very low prices. Factories like these have been the driving force behind China’s huge economic growth in recent decades, but the outbreak of the Chinese coronavirus means that it could all change.
While Apple has been looking at moving some of its production to India (and even the United States) in recent years, the supply chain disruption caused by the Chinese coronavirus, along with political pressure, means the tech giant is now looking to India to handle more of its manufacturing.
According to Apple news website MacRumors, Apple is looking to move a “significant portion” of its iPhone production from China to India. The company may be planning to redirect as much as $40 billion of smartphone production to India.
The Indian Economic Times made the same claims, suggesting that Apple senior executives have held regular meetings in recent weeks and months with Indian government officials to set the stage for the manufacturing of iPhones in India. The government and Apple are looking at moving a fifth of the company’s full production capacity away from China and into India in a deal that could be worth $40 billion over five years.
Another contributing factor could be that Apple is looking to become more popular in the Indian smartphone market. India is a substantially different market when it comes to consumer electronics owing to the fact that people earn less and typically spend less on devices like computers and phones. Apple’s traditionally higher prices mean that Android phones are much more popular in India, as there has long been no affordable iPhone option.
That all changed with the release of the iPhone SE last month, a new special edition iPhone that sells for just $399. As Apple devices get more affordable and manufacturing moves to India, it shows that the tech giant is making serious efforts to expand into new markets.
The decision is also reportedly connected to India’s Production Linked Incentive scheme, which is designed to attract companies to India for manufacturing services. In order to qualify for the PLI scheme, a company will need to produce more than $10 billion of mobile phone products between 2020 and 2025 – a minimum order that Apple could easily meet.