Foxconn Technology Group, a partner of Apple Inc., plans to invest $700 million in India’s new plant to improve local production. This demonstrates a hasty departure of Chinese manufacturing as tensions between Washington and Beijing rise.
The Taiwanese company, which is best known for its flagship product, Hon Hai Precision Industry, intends to construct the plant on a 300-acre site in Bengaluru, Karnataka, close to the airport. Apple’s receivers could also be stored at the factory, and Foxconn builds electric vehicles on the site.
The investment highlights China’s risk of losing its position as the largest electronics producer in the world and is one of Foxconn’s largest single expenditures in India. Apple and other American brands encourage their Chinese dealers to travel to alternative locations like Vietnam and India. The pandemic-improved global supply chain is being rethought, and the conflict in Ukraine may alter how electronics are disposed of worldwide. It is anticipated that approximately 100,000 jobs will be created by the new production in India.
Apple should re-evaluate its dependence on China’s supply chain after the Zhengzhou plant’s output plummeted ahead of the holiday season as a result of problems related to COVID-19. The most recent development that suggests suppliers may move size out of China sooner than expected is Foxconn’s choice.
Foxconn is confirming the specifics of the investment and project, so the plans could change. The plant doesn’t say much about Foxconn’s new capacity or how far away from other locations, like its Chinese services, it is.
As western investors and businesses become dissatisfied with China’s restrictions on the private sector, the decision made by Foxconn would be a coup for Modi’s government because it presents an opportunity to close the technology gap between India and China.
Apple suppliers like Foxconn, which began producing the most recent iPhone generation last year at a factory in the state of Tamil Nadu, have received financial incentives from India. Suppliers like Jabil Corp have begun producing AirPods components locally, and their smaller competitors Wistron and Pegatron are also expanding their operations in India.
