Apple Inc provider Pegatron in talks to open second India manufacturing facility -sources

By Munsif Vengattil and Aditya Kalra

NEW DELHI (Reuters) – Apple Inc (NASDAQ:)’s Taiwanese provider Pegatron Corp is in talks to open a second India manufacturing facility, mentioned two sources with direct data of the matter, because the U.S. tech large’s companions proceed to diversify manufacturing away from China.

Pegatron plans so as to add a second facility close to the southern metropolis of Chennai in Tamil Nadu state, simply six months after opening the primary with an funding of $150 million, mentioned the sources, who sought anonymity because the talks are non-public.

The brand new manufacturing facility, the primary supply mentioned, is “to assemble the most recent iPhones”.

Pegatron declined to remark however mentioned, “Any acquisition of property shall be disclosed based mostly on laws.”

Apple didn’t reply to a request for remark.

India is seen as the subsequent development frontier for Apple. Round $9 billion price of smartphones have been exported from India between April 2022 and February this yr, and iPhones accounted for greater than 50% of that, in accordance with the India Mobile and Electronics Affiliation.

Pegatron at the moment accounts for 10% of Apple’s iPhone manufacturing in India on an annualised foundation, analysis agency Counterpoint mentioned.

Apple and its key suppliers have been shifting manufacturing away from China as they search to keep away from a possible hit to enterprise from mounting Sino-U.S. commerce frictions. Lately, Pegatron has sought to develop its footprint in Southeast Asia and North America.

The talks for beginning a second Pegatron facility on lease are ongoing and it will likely be situated inside Mahindra World Metropolis close to Chennai, simply round the place the corporate inaugurated the primary plant in September 2022.

Pegatron’s deliberate funding outlay for the growth will not be instantly clear. The primary supply, nonetheless, mentioned the brand new manufacturing facility shall be smaller than the primary one.

Apple Inc has wager large on the South Asian nation because it started iPhone meeting within the nation in 2017 by way of Wistron and later Foxconn, according to the Indian authorities’s push for native manufacturing.

India is the second greatest smartphone market on the planet, the place Apple additionally plans to assemble iPad tablets and AirPods.

India’s Karnataka state mentioned this week it has permitted a $968 million funding by Foxconn, resulting in the creation of fifty,000 jobs.

Final week, Reuters reported Foxconn has plans to construct a $200 million manufacturing facility in India to supply the wi-fi earphones for Apple after successful a contract. It already assembles some iPhone fashions at its plant situated in Tamil Nadu.