Apple’s new iPhone 14 aims to show that India is closing the technological gap with China

Apple Inc. plans to start manufacturing the iPhone 14 in India about two months after the product’s initial release from China, narrowing the gap between the two countries but not completely, as some had expected.

According to people familiar with the matter, the company has been working with suppliers to ramp up production in India and cut the delay in producing the new iPhone from the typical six months to nine months seen in previous launches. Apple, which has long made most of its iPhones in China, is looking at alternatives as Xi Jinping’s government clashes with the US government and imposed lockdowns across the country that have disrupted economic activity.

Analysts like TF International Securities Group’s Ming-Chi Kuo expect Apple to ship the next iPhone from both countries around the same time, which would have been a key benchmark for Apple’s efforts to diversify its supply chain and build redundancies.

Foxconn Technology Group, the main maker of iPhones, was investigating the process of shipping components from China and assembling the iPhone 14 device at its plant outside the southern Indian city of Chennai, the people, who asked not to be identified, said the efforts are confidential . This included looking for ways to maintain Apple’s high standards of confidentiality.

Apple and Foxconn eventually noted that a simultaneous launch in India and China this year isn’t realistic, though it remains a long-term goal, the people said. The first iPhone 14s from India are expected to be ready in late October or November, after the initial release in September, they said. One ambitious target would be the Diwali festival, which begins on October 24, one person said.

A spokesman for Apple in Cupertino, California, declined to comment. Foxconn did not immediately respond to requests for comment.

Redington India Ltd., which distributes Apple products in the country, rose as much as 9.5 percent, according to Bloomberg’s initial report.

Matching the pace of iPhone production in China would have been a major milestone for India, which has touted its appeal as an alternative at a time when Covid lockdowns and US sanctions threaten China’s position as a factory for the world. Assembling iPhones often requires coordination between hundreds of suppliers and meeting Apple’s notoriously tight deadlines and quality controls.

Some people at Apple and Foxconn had hoped to start concurrent production in India this year, but that was never an official plan. To ensure a smooth start, Apple wanted to focus on getting China operations off the ground first and then working out India production, one of the people said.

Apple’s partners began manufacturing iPhones in India in 2017, the start of years of efforts to build manufacturing capacity in the country. In addition to providing support for its existing operations, the country of 1.4 billion people is a promising consumer market, and the Modi government has offered financial incentives for technology production as part of its Make in India program.

One challenge in narrowing the cap on Indian production is secrecy. Apple goes to extreme lengths to keep new product details confidential, and imposing the same strict controls in a second country would prove difficult.

Local leaders in India were investigating, according to two of the people, to completely divert a section of one of Foxconn’s many production lines, confiscating workers and examining any possible ways in which safety around the equipment could be compromised. So far, it has been difficult to repeat the drastic security checks and strict lockdown at Chinese facilities, one of the people said.

Apple was also concerned about Indian customs officials, who typically open packages to verify imported materials match their declarations, another potential vulnerability to product secrecy.

Even if Apple and Foxconn had intended a simultaneous launch, supply chain challenges would have hampered the goal. China, the source of many iPhone components, has gone through successive waves of lockdowns, making the process of shipping components across the country difficult.

India’s workforce and factories have not simply adopted the tightly controlled practices that Apple requires of its suppliers. Since Apple began assembling iPhones in India five years ago through contract manufacturers Foxconn and Wistron Corp. began, workers were outraged in two high-profile incidents about wages and the quality of food. Apple’s new iPhone 14 aims to show that India is closing the technological gap with China

Fry Electronics Team

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