Apple suppliers Foxconn & Pegatronto invest more in Tamil Nadu plants

Apple Inc’s suppliers, Foxconn and Pegatron, are looking to expand production capacity at their facilities in Tamil Nadu that are currently assembling flagship smartphone models like iPhone 14, even as the disruption in production in China continues due to a slew of factors.

The two Taiwanese contract manufacturers of Apple Inc will invest more in Tamil Nadu as the demand from their client to assemble phones in India continues to increase, sources in the know told DH. The development comes amid reports that Apple wants to shift a significant portion of its China operations to India.

“Since Foxconn and Pegatron operate in Chennai already, they want to expand their facilities by pumping in additional investments,” a source told DH.

Foxconn, another source in the know said, is in the process of building a third unit in the Sriperumbudur premises exclusively for assembling Apple products. “The construction work is on and they have applied for various permissions and approvals,” the source said, without giving details about the tune of fresh investments.

The source also added Pegatron, whose massive facility was thrown open on September 30, is also looking to expand its production capacity. Both Foxconn and Pegatron currently assemble high-end Apple phones, including the flagship iPhone 14.

“Both Foxconn and Pegatron are investing more in expanding their Apple assembling units. But the percentage of iPhones made in India are very less when compared to other countries. The Tamil Nadu government is finding ways to help create an ecosystem that helps companies like Foxconn to mass produce electronic goods like in China,” the source added.

Foxconn and Pegatron didn’t respond to emails sent by DH seeking their response.

The production of Apple accessories in India will also get a boost once the Union government approves the proposal by Luxshare, a Chinese contract manufacturer of the Cupertino-based electronics giant, to function from the now-defunct Motorola plant outside Chennai.

The sources told DH that the request by Luxshare is being fast-tracked and it is just a matter of time before the company gets the required permission provided all papers are in order. “It is taking time because there is a long process that is followed to permit Chinese companies to operate in India. The wait may end soon,” a source in the know said. Efforts to reach Luxshare for a response didn’t fructify.

If Luxshare is allowed to operate from Chennai, it will join the likes of Foxconn and Pegatron, who currently have massive production facilities in Sriperumbudur and Singaperumalkovil respectively, making Tamil Nadu the hub of Apple phones in the country. Besides, Tata Electronics, which is building an electronics ecosystem in Hosur, will manufacture platforms for Apple smartphones.

Two out of three of Apple’s suppliers are located in Tamil Nadu, which currently accounts for 20 per cent of the national production of electronics and hardware, aims to increase the share to 25 per cent and enhance the industry's output to $100 billion by 2025.

The state, which is already home to the top 16 electronics manufacturers, including Nokia, Samsung, Flex, Dell, Motorola, Salcomp, HP, and Foxconn, wants the electronics industry to be on par with automobiles which accounts for 37.6 per cent of the country's automobile and auto component exports, apparel (30.8 per cent) and footwear (46.4 per cent).

The state has two exclusive Special Economic Zones (SEZs) for Electronics and Hardware manufacturing in Sriperumbudur, 50 km from here, and in Oragadam, 70 km from here, spread over 800 acres.