Apple plans to manufacture iPhone 14 in India

NEW DELHI, Delhi — Apple Inc. will make its iPhone 14 in India, the company said Monday, as manufacturers shift production from China amid geopolitical tensions and pandemic restrictions that have disrupted supply chains for many industries.

“The new iPhone 14 lineup introduces innovative new technologies and important security features. We are very excited to manufacture iPhone 14 in India,” Apple said in a statement.

Earlier this month, Apple unveiled its latest line of iPhones. They will have improved cameras, faster processors and longer-lasting batteries at the same prices as last year’s models.

India is the world’s second-largest smartphone market after China, but Apple’s iPhone sales have struggled to capture much of the market share compared to rivals’ cheaper smartphones.

The announcement from the Cupertino, Calif.-based company coincides with Prime Minister Narendra Modi’s push for local manufacturing, a key goal of his government since he took office in 2014.

The tech company has made a big bet on India, where it first started manufacturing its iPhone SE in 2017 and has continued to build a number of iPhone models there ever since. Apple opened its online store for India two years ago, but the pandemic has delayed plans to open a flagship store in India, local media reported.

The latest model will be supplied by Foxconn, a major iPhone assembler whose factories are located on the outskirts of Chennai, a city in southern India.

Apple is likely to shift around 5% of iPhone 14 production to India from the end of this year, raising it to 25% by 2025, according to a JP Morgan report cited by the Press Trust of India news agency.

Analysts expect nearly a quarter of all Apple products to be made outside of China by 2025, up from about 5% now. Supply chain risks, such as the severe COVID-19 shutdowns seen in China, are likely to be the trigger for such relocation efforts to continue over the next two to three years, the report said.

“Apple has been trying to diversify its supply chain for some time, but those efforts have increased over the past two years due to trade sanctions between the U.S. and China,” said Sanyam Chaurazia, an analyst at Canalys.

Last year, the tech giant produced around 7 million iPhones in India. The news is likely to significantly increase the number of Apple smartphones manufactured in India, he added.

He said the plan to produce more iPhones in India could also lead to Apple lowering prices for the Indian market, making it more competitive. “You can adopt a more aggressive pricing strategy if you’re manufacturing locally,” Chaurasia said.

Most Apple Inc. smartphones and tablets. assemble contractors with factories in China, but in 2020 the company began asking them to consider moving production to Southeast Asia or elsewhere after repeated shutdowns to combat COVID-19 disrupted the global flow of products.

Apple did not release details, but news reports said the company planned to set up assembly of tablet computers and wireless headphones in Vietnam.

Other companies are keeping or expanding production in China to serve the domestic market, while moving export-oriented work to other countries because of rising wages and other costs, as well as difficulties for foreign executives to visit China due to anti-terrorist travel. COVID-19 restrictions.

AP Business Writer Joe McDonald in Beijing contributed.