Apple fans in India, you have something to rejoice about as iPhones might be about to get a lot cheaper for you to buy.
That's because Taiwanese manufacturer Foxconn says iPhones will go into mass production in India sometime this year, according to a new report.
Foxconn Technology Group Chairman Terry Gou said in an interview with Bloomberg that they will begin mass-producing the iPhone in the country. They're the largest assembler of Apple products and have, for the longest time, had the major portion of their activities focused in China.
Gou mentioned that PM Narendra Modi has invited him to India as part of their plans to expand here. To clarify, Foxconn does have a facility in Bangalore that produces iPhones, but only for older models. This move will have the latest devices also being produced in India. The company will likely carry out production tests here before beginning full scale assembly at its factory outside Chennai.
There's good reason for this too. For years now, China has provided a cheap source of labour for smartphone manufacturing, as well as a large market for sales. In recent years however, the Chinese smartphone market has stagnated in recent years, especially where iPhones are concerned. Not only are people keeping their iPhones for longer before upgrading, many of them are also opting for cheaper and equally capable Androids that are locally produced.
That makes India now the fastest-growing smartphone market in the world. Of course, Apple still doesn't have a large piece of the pie, largely because of its exceptionally high prices. Local manufacturing could help to offset this however, making Apple a more competitive player in our price-conscious market.
"For Foxconn, the China market for iPhones is saturated, and labor costs are three times higher compared with India," Karn Chauhan, a Gurgaon-based analyst at Counterpoint Research, told Bloomberg "India is still an emerging smartphone market, it has a lot of potential domestically and could serve as an export hub for the region."
Based on comments, Foxconn plans to invest about $300 million on manufacturing for Apple in India, with more cash infusions to ramp up as their capacity expands. The company is also reportedly in talks with the Indian government regarding investments and subsidies.
Additionally, if Apple meets a 30 percent local sourcing quota, they'll be allowed to open their own stores in India.