Seeking to lower its reliance on China, Apple starts iPhone 13 production in India

Seeking to lower its reliance on China, Apple starts iPhone 13 production in India
India is the second-largest smartphone market in the world after China. Because of its status as a developing country, per capita income is low and approximately 70% of smartphone sales in the country are budget models ranging in price from 7,500 Rs to $1,500 Rs ($99 to $198). The top smartphone brands in the country are Xiaomi and Samsung.

Thanks to incentives put in place by India's Prime Minister Narendra Modi called the "Make in India" plan, companies like Apple were given incentives to locally produce products being sold in the country. In addition, iPhones made in India avoid being hit with a hefty import tax helping to keep prices low. Apple started producing the iPhone in India back in 2017 with assembly lines churning out the low-priced OG iPhone SE.

In 2019, Apple advertised the "Incredible" iPhone 6s even though the phone was four years old at the time. Since then, Apple began manufacturing high-end iPhone models in the country. Reuters reports today that Apple has started assembling the iPhone 13 in India and in addition to all of the previously mentioned reasons to produce the handset in India, it also might reduce Apple's reliance on using contract manufacturers with factories in China.

It wasn't that long ago that the U.S. was slapping imports from China (including several Apple products) with import taxes and falsely claiming that China was paying the U.S. Treasury Department the cost of these tariffs. What actually happened was that U.S. companies like Apple were paying for the tariffs and had a choice. It could eat the additional cost of the import tax and accept lower profits, or it could raise the price of affected products leaving U.S. consumers to pay.

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Not wanting to have to make such a decision again, Apple started looking at other locations to build the iPhone including India, Mexico, and Vietnam. The Reuters report states that Apple is building the iPhone 13 at a plant in India owned by Foxconn, Apple's top contract manufacturer. A source tells Reuters that the factory is located in Southern Tamil Nadu state in the Indian town of Sriperumbudur.

Besides assembling the iPhone in India, today's report states that Apple is planning on building some of its iPad tablets in the country. When looking at alternative manufacturing facilities, companies like Foxconn and Apple look for cheap and plentiful labor, and close proximity to the supply chain.

By Reuters' count, the iPhone 13 is the fourth iPhone model to be produced in India.

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