Apple Has 'Constructive' Meeting With India About Local Manufacturing Opportunities [Updated]

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Apple on Wednesday said it appreciated the "constructive" dialogue it had held with officials from India regarding the expansion of its local operations in the country.

Earlier this month, reports indicated that a high-level meeting would be taking place between the two sides, with Apple seeking concessions from the Indian government if it agreed to manufacture products locally. That meeting now appears to have taken place, although in a statement given to Reuters today, Apple offered little hint as to the outcome of those discussions.

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"We've been working hard to develop our operations in India," Apple said in a brief statement. "We appreciate the constructive and open dialogue we've had with government about further expanding our local operations."

Apple was said to be going into the meeting looking for a number of tax and other incentives, including long-term duty exemptions, but the Indian government recently appeared to push back against those demands, suggesting that it would review its entire mobile manufacturing policy instead.

However, the government's IT ministry offered the most recent indication that the government was willing to listen to Apple, saying it would consider any requests for incentives with an "open mind".

In a report by The Times of India last month, Apple was said to be looking into building an iPhone manufacturing plant in Bangalore, with Wistron as a partner. Earlier this week it was revealed that Apple had tapped Wistron as its first major supplier in India for this year's iPhone 8.

Update: According to a senior official in the Indian government, Apple's deal with the country to manufacture products locally is nearly close to completion. The official told The Wall Street Journal that "it's almost a done deal."

Tag: India

Top Rated Comments

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45 months ago

More cheap labor. At least with China he's been using the excuse of "They have certain skills that Americans don't have".

India produces 1.5 million engineers per year. If you include all the STEM fields that number will be much larger. Can you please tell me which country on earth can produce more than 1.5 million engineers per year? They have more educated workforce with BS in Science and technology.
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India wants Apple to manufacture phones sold in India, in India. Imagine that. Echoes of President Trump. I say it's a good thing. Go ahead and open or support a factory in India, Apple. Great idea.

But it will cost less if Apple manufactures in India and their margins won't be affected and prices will be affordable to the customers. An iPhone starts at $1000 in India. Apple can price it at $650 if they can manufacture there. Logically good step.
Score: 4 Votes (Like | Disagree)
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45 months ago

Why India over China? I know India and the surrounding areas have a long history of making clothes but electronics?

I think it is very smart of Tim to line up alternatives to China, in light of political tensions and China flexing its military muscles against the USA and allies.
Score: 4 Votes (Like | Disagree)
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45 months ago
Is this ok with Trump????
Score: 2 Votes (Like | Disagree)
Avatar
45 months ago

India wants Apple to manufacture phones sold in India, in India. Imagine that. Echoes of President Trump. I say it's a good thing. Go ahead and open or support a factory in India, Apple. Great idea.

Correct. This plant will only be for iPhones sold in India. Exactly what trump wants, iPhones sold in america should be made in america. Just as he is doing with cars right now.

Although politicians are delusional to think it will create jobs, as these plants will be mostly automated AND the plants are going to be "assembly" plants. All the parts will still be imported from China, the circuit boards, batteries, and etc. BMW and other luxury car makers do this exact same thing india. They ship a body, doors, engine, wheels and assemble it in India, not that many jobs end up actually being created.

Off course the public doesn't know this and assumes its a manufacturing plant with tons of jobs, as this thread itself indicates. In the end its all a sham and politicos still eat it up cuz its good marketing for themselves and their party while the public is blissfully ignorant of its actual impact on economy.

Read: https://www.bloomberg.com/gadfly/articles/2016-12-07/dear-mr-trump-about-those-u-s-iphones
Score: 2 Votes (Like | Disagree)
Avatar
45 months ago

Correct. This plant will only be for iPhones sold in India. Exactly what trump wants, iPhones sold in america should be made in america. Just as he is doing with cars right now.

Although politicians are delusional to think it will create jobs, as these plants will be mostly automated AND the plants are going to be "assembly" plants. All the parts will still be imported from China, the circuit boards, batteries, and etc. BMW and other luxury car makers do this exact same thing india. They ship a body, doors, engine, wheels and assemble it in India, not that many jobs end up actually being created.

There are other countries that require/'encourage' local assembly as well, like Argentina or Brazil. A common term used here is Completely Knock(ed) Down (CKD). This can go as far as partially de-assemblying complete cars and sending the components to the assembly country to re-assemble them, though that is rare. More common is that in the main assembly plant in, eg, Germany the logistic operations that provide the correct mix of parts to the (German) assembly line for every car also provide the same mix for every car assembled abroad and put that mix into a big box and ship it out. It is relatively obvious that this is an example of regulations that largely only add costs for little benefit.

But Trump's approach has other problems. Many big manufacturers concentrate the total global production of a given model to one factory (excluding the CKD exceptions). For example, all BMW X5 models sold worldwide come out of their U.S. production facility. All MINI models sold worldwide come out of a factory in the UK. For another model, the production might be concentrated in Portugal, Spain, Hungary, Brazil or Mexico (or of course Germany). Requiring that all cars sold in the U.S. are manufactured there is simply less efficient.
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Why India over China? I know India and the surrounding areas have a long history of making clothes but electronics?

India has been a country with a highly regulated economy. Apple's current move to India was partially born out of the desire to be allowed to open Apple Stores over there. Foreign companies are not allowed to operate retail stores in India unless they what they sell is produced predominantly in India. This meant that Apple so far had little control over distribution in India and also led to iPhones being more expensive there than in the U.S. or China.
Score: 2 Votes (Like | Disagree)
Avatar
45 months ago
I'll take an American Made Trump iPhone any day !
Score: 2 Votes (Like | Disagree)

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