Half of All iPhone Units to Be Assembled in India by 2027 as Apple Moves Production Out of China: Report

Apple reportedly intends to produce 50 percent of all iPhone units in India by 2027. The COVID-19 pandemic and the restrictions it imposed had a negative impact on many businesses that had production plants in a single country. Numerous waves of the pandemic that erupted in China wrecked the sector. The country's restrictions also had a significant impact on Apple's production, as its Taiwanese partner Foxconn has a strong presence in the country. In order to decrease its dependence on China, the company reportedly intends to increase its production capabilities in India.

According to a report from September 2022, a JP Morgan analyst predicted that iPhone production in India would reach about 25 percent of total global output by 2025. Apple was expected to minimise its dependence on China for the production process. A South China Morning Post report, that figure will rise to 50 percent by 2027.

“India may produce one in two of the world's iPhones by 2027, compared with the current state of less than 5 percent, according to a forecast last week by Luke Lin, an analyst at the research unit of Taiwan's DigiTimes newspaper,” the SCMP report read.

India currently produces only 5 percent of all iPhones. Apple reportedly pressed its Indian arm a little harder this year in order to boost the production of the iPhone 14 series. The COVID-zero initiative in China had a significant impact on Apple's flagship models for 2022.

Apple intends to be prepared for the iPhone 15 and wants to start production in China and India simultaneously, as per the report, which says that trial production has already begun in China. In December 2022, it was reported that the government was looking into attempting to bring some of Apple's iPad production from China to India.

The move will undoubtedly be welcomed by the Indian government as it will boost its Make in India campaign. In recent years, India has implemented a number of policies to encourage brands to begin domestic production in the country.

On the other hand, Apple has often warned against interpreting supply chain reports too extensively. This is because the firm prefers to use multiple suppliers whenever possible, even a substantiated alteration in orders for one firm may be cancelled out by trying to balance alteration in orders for another. Nonetheless, there is some evidence of the effects of Apple's ongoing efforts to shift production away from China.

According to one analyst in the same report, one potential issue is preserving quality standards in a more diversified supply chain. To meet quality standards, Apple has traditionally worked extremely closely with Chinese suppliers and therefore, the concern may be overstated, given that much of Apple's production even outside China is with Taiwanese or Chinese firms.