Last Updated on September 4, 2024
This year, Apple Inc. will produce its high-end iPhone Pro and Pro Max models in India for the first time, marking a significant milestone for both the company and the Asian manufacturing sector.
According to sources familiar with the situation, Foxconn Technology Group, a key partner, will start assembling these premium devices shortly after their global release this fall. The company has begun training thousands of employees at its facility in Tamil Nadu, aiming to have the iPhone 16 Pro and Pro Max ready as soon as possible after their international launch.
Apple’s initiative to manufacture its entire range of iPhones in India represents a major development in its local expansion efforts, which gained momentum in 2021 thanks to financial incentives from Prime Minister Narendra Modi’s government aimed at boosting high-end manufacturing. While Apple continues to produce most of its iPhones in China, it is strategically shifting some production to mitigate risks associated with the US-China tensions.
As a result, Apple is expected to assemble iPhones worth $14 billion in India for the fiscal year ending March 2024, which could represent up to 14% of its global production. Similar to the previous year, the new iPhone 16 is anticipated to launch in India simultaneously with its worldwide release.
Apple’s other partners in India, Pegatron Corp.’s local branch and the Tata Group, might soon start producing the Pro models as well. These high-end versions, which feature larger batteries, superior cameras, and titanium bodies, necessitate more specialized production processes.
Representatives from Apple, Foxconn, and Pegatron have chosen not to comment, while Tata has not responded to requests for a statement.
As the world’s most populous country, India is becoming a crucial market for Apple. The brand’s devices are increasingly seen as status symbols among the country’s growing middle class. Last year, CEO Tim Cook visited India to inaugurate the first two Apple stores, with annual sales nearing a record $8 billion.
By year-end, locally produced iPhones are expected to meet domestic demand. Manufacturing in India could potentially reduce the prices of the Pro models by up to 10% compared to imported versions, which face import duties. However, high costs for components and local taxes will still keep the prices of the iPhone 16 Pro and Pro Max higher than in some countries with lower tax rates.
Apple plans to export most of the iPhone Pro and Pro Max units made in India to Europe, the Middle East, and the US, as the demand for these high-priced models is relatively lower in India. However, sales might get a boost during the upcoming festive season.
Despite recent sluggish sales, iPhones account for about half of Apple’s global revenue. The new iPhone 16 series will offer improved cameras, processors, and displays.
According to Bloomberg Intelligence, Apple’s sales in India have surged by 33% to nearly $8 billion over the past year. This growth, amid increased competition in China, supports the view that India is a key growth market for Apple, given its currently low market share. Projections suggest that India’s sales could reach $33 billion by 2030, driven by a rising middle class and increased use of payment plans.