Apple is reportedly accelerating its shift of iPhone production from China to India, with the latter potentially becoming a primary source for iPhones sold in the US. This move is driven by a combination of factors, including escalating trade tensions between the US and China and the desire to diversify production away from a heavy reliance on China.
CEO Tim Cook has confirmed that India will become the primary source of iPhones sold in the US, as Apple pivots production away from high-tariff China to cost-effective Indian supply chains. Apple is aiming to have most of the iPhones sold in the US assembled in Indian factories by the end of 2026. To achieve this, Apple is in discussions with its outsourcing partners in India, including Foxconn and the Tata Group, to execute this plan. This shift could potentially double Apple's current output from India.
This isn't a completely new endeavor. Apple has already expanded production in India to counter tariffs imposed during the previous Trump administration. In 2024, Apple sought to pivot towards India for the production of its iPhones, for which its main supplier, Foxconn, and Tata started importing already assembled component sets from China.
The move to India isn't without its challenges. Manufacturing iPhones in India is reportedly more expensive than in China. There are also concerns about whether India's infrastructure can handle a surge in production. Furthermore, there have been reports of Chinese authorities creating roadblocks for Apple suppliers moving operations from China to India, including delayed or blocked shipments.
Despite these challenges, Apple seems committed to expanding its manufacturing presence in India. Foxconn is building a $2.6 billion plant in Bengaluru, which is expected to begin assembling iPhones soon and is designed to produce 300 to 500 iPhone units per hour, with plans to manufacture the upcoming iPhone 16 and 16e models. This plant is expected to be completed by December 2027 and could create up to 50,000 jobs. Tata Electronics has also started production at a new iPhone assembly plant in Hosur, Tamil Nadu.
Analysts expect Apple to maintain a significant presence in China, as a substantial portion of its sales still come from that country. However, the shift to India is viewed as a long-term strategy to mitigate risks associated with US-China trade tensions and diversify its manufacturing base. It's also seen as a boost to India's electronics manufacturing ecosystem, potentially increasing India's iPhone output to 70-80 million units by the end of 2026.
