Make In India: Moody’s Bullish On Apple’s Manufacturing Capabilities In India

Apple beginning the manufacturing of its latest iPhone 14 in India within weeks of its global launch demonstrates the maturity of the Cupertino-based company’s manufacturing capabilities in the country, Moody’s Investors Service said in a note.

Noting that Apple has been producing iPhones in India since 2017, Moody’s said, “… the manufacturing of iPhone 14 within weeks of their global launch demonstrates the maturity of the company’s manufacturing capabilities in India that we expect to ramp up quickly.”

The increase in volume of locally-manufactured iPhones will also accelerate the tech giant’s expansion strategy in India, a PTI report quoted Moody’s as saying. 

The strong growth prospects of the Indian smartphone market with the launch of the 5G network “makes it an attractive long-term market for Apple”, it added.

Apple globally launched its latest smartphone iPhone 14 on September 7 and within two weeks, the company said that it was starting the manufacturing of the latest model in India. As per reports, the India-manufactured phones will be shipped from Apple’s contract manufacturer and iPhone assembler Foxconn’s Chennai facility.

Apple’s contract manufacturers in India today make some of its other most advanced iPhones, including iPhone SE, iPhone 12, and iPhone 13. They will reportedly make iPhones worth INR 47,000 Cr in the current fiscal compared to the production of iPhones worth INR 10,000 Cr by Foxconn in the last financial year.

“Apple’s plan to manufacture iPhone 14 products in India is credit positive because it will diversify its manufacturing base that is highly concentrated in China,” said Raj Joshi, senior vice president, corporate finance group at Moody’s.

Recently, brokerage JP Morgan said that Apple might manufacture one out of four iPhones in India by 2025. Besides, the tech giant may move about 5% of iPhone 14 production to India by late 2022, the brokerage said.

These developments provide a boost to the Indian government’s efforts to boost domestic manufacturing in the country. It has also launched a production linked incentive (PLI) scheme for large-scale electronics manufacturing to boost the production of mobile phones and other electronic components in the country.

Earlier this month, a report also said that tech giant Google is mulling moving some of its smartphone production from China to India, and has sought bids from Indian manufacturers to produce 5-10 Lakh units of its Pixel smartphones.