The morning runes suggest Apple may be preparing to increase the scale of iPhone manufacturing in India, as component orders, market speculation and news from supply chain partners combine to suggest just that.
The iPhone 9 unicorn is (almost) here, maybe
Industry watchers believe Apple will very soon replace iPhone 8 with a new device called, (appropriately enough given the company’s naming conventions) “iPhone 9”.
We’ve glanced at the rumors already, but here’s a quick reprise of what we think we know:
- A13 processor.
- Touch ID.
- 64GB and 128GB models.
- 3GB RAM.
- U1 chip.
- LCD display, from 5.4-inches. (Though other reports suggest 4.7-inches).
- Single lens camera.
- Space grey, silver, red.
- Don’t forget, rumors are rumors and just because people say things might happen doesn’t mean they will. I’m glad to have got that out the way.
More recently, we learn Apple plans to commence manufacturing these things in February 2020, following previous claims it intends putting them on sale perhaps as soon as March.
Sure, but what about manufacturing?
Apple already makes iPhones in India where its partner Wistron already has two factories which have been occupied manufacturing iPhone SE and iPhone 6S.
Digitimes now tells us it has opened a third factory which will also begin making iPhones. Foxconn is also making iPhones in India and Pegatron is also looking to place factories there. Smaller Apple partners such as Salcomp are also investing in production facilities in the country.
Given current trade tension between the current U.S. administration and China, it makes sense for Apple to diversify its supply chain in order to protect shoppers against unexpected price hikes.
The company has been applying a great deal of energy in India for some time both because it wants to both generate new business in India’s rapidly expanding economy and also because it really, really wants to diversify its supply chain.
Apple has also been ever so keen to stress that it is looking to make a long-term commitment to the country.
“We’re not here for a quarter, or two quarters, or the next year, or the next year,” Apple CEO Tim Cook said on a 2016 visit there. “We’re here for a thousand years.”
Jaw-jaw beats war-war
It’s fair to say Apple hit some hurdles. Not only were its products quite expensive in terms of the local economy, but India enforced a number of regulations that made expanding its business there difficult. To mitigate these challenges, it appears Apple has engaged with local government to find a mutually useful compromise.
That’s why news that India’s Ministry of Electronics and Information Technology is exploring a range of initiatives it hopes will encourage big tech firms to set up shop there seems so well timed – with tax breaks, loan subsidies, infrastructure investment and the creation of special tech industry zones all being discussed.
In other words, the timing seems pretty good for at least some expansion of Apple’s manufacturing presence in India, even as its iPhone 11 series devices have re-ignited local interest in the company’s products. The iPhone 11 is selling strongly in India with queues of people ready to shop when the device launched.
Apple’s move to improve its current low end offering (the iPhone 8 is currently the entry-level model) with an iPhone 9 will widen the breadth of what it has available. The company already makes the iPhone XR there, reports have claimed, and these devices are apparently exported elsewhere.
Made in India?
With a new model set to go into production in February, news that Apple has asked TSMC to increase production of Apple’s A-series processors is likely not just spurred by strong sales, but also to address what’s coming in FY20 Q3, which is: Even stronger sales as a lower cost model hits the shelves.
If successful (and there’s little reason an A13-powered but more affordable device shouldn’t be) the new model is going to require the company to ramp up its manufacturing capacity – and with so many partners investing deeply in manufacturing centres there, it seems possible we’ll see at least some of these new iPhone models designed in California, but Made in India.
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