Apple is facing challenges as its tries to increase production of its products in India, according to a paywalled report by The Financial Times (via Reuters).
As Apple plans to diversify its supply chain outside China, the Cupertino firm is having a hard time with its iPhone production in India. A shows that half of the components from the production line in the country are in “good enough shape to be sent to Apple’s supplier Foxconn.”
For example, Apple supplier Tata Group only has a “50% yield,” which doesn’t meet Apple’s goal of zero defects. Logistics, tariffs, and infrastructure are also problems the the tech firm is experiencing. Former Apple engineers told The Financial Times that Chinese iPhone suppliers and government officials have a “whatever it takes” approach to win iPhone orders.
All this is obviously causing issues with Apple’s plans for India to account for up to 25% of its production, increasing from about 5%-7% currently. The company wants to significantly reduce its reliance on China.
For example, Foxconn, Apple’s biggest contractor has invested US$500 million in its Indian subsidiary, as the Taiwanese manufacturing giant moves ahead to diversify its supply chain after China’s stringent pandemic controls disrupted production at its top iPhone plant in the central city of Zhengzhou, reports The South China Morning Post.
