There is a phrase circulating on the domestic Internet that "India makes money Indian flowers, and they want to take them home", which means that domestic manufacturers are operating in India in a relatively bad state, and many manufacturers have suffered unfair and huge penalties in recent years. However, some manufacturers do not say that they "spend money" in India, it is very difficult to make money locally, and the latest news shows that Apple foundries have announced their withdrawal from business in India, because they can't make money at all and can only operate at a loss.
According to foreign media reports, Flextron announced that it officially withdrew from the Indian Apple mobile phone foundry business, and will not produce any models for Apple in India in the future, and only retains the basic content such as the simplest handover business locally.
Speaking of Apple foundries, most people may subconsciously think of Foxconn, in fact, Flextron is also one of Apple's foundries, but the share is relatively small, and it is mainly responsible for cheap mobile phones. As early as around 2017, Wistron established a foundry at Apple to help Apple produce iPhone SE models locally, and Foxconn and Pegatron also built factories in the local area after seeing Wistron's success, and are now fully transferring workshops.
If Wistron was the first to open up Apple's market in India, why is it insisting on exiting India now? At present, there are mainly many factors, and the official statement that "Apple is too tough on price negotiations, resulting in the company's inability to make profits in India" has only withdrawn.
A person familiar with the matter further explained that as foundries such as Foxconn and Pegatron open up their business in India, Apple has become more and more tough in negotiations with Foxconn, squeezing the other party's profits to the minimum. If Wistron had accepted the negotiation, the business now operating in India would not only not be profitable, but would also be able to lose money, and because it is too small to have a voice, it will have no choice but to withdraw from the Indian market.
Wistron has encountered a number of targeted incidents in India in the past few years, and it has faced a series of investigations and penalties. Now, after Wistron exited, the workshop was acquired by the Indian local company Tata Group, which will be the first Indian company to manufacture for Apple, and it is difficult to say whether it played a role in forcing Wistron to withdraw, and as a result, it became the biggest beneficiary.
In the future, Foxconn, Pegatron and Tata Group will become Apple's main foundries, and the main foundry workshops will be transferred to India. According to Foxconn's previous statement, it is expected that 25% of mobile phones will be manufactured in India in 2024, and 50% of mobile phones will be manufactured in India in 2027, and India will become the most important OEM production area for iPhones, gradually transferring production capacity in China and accelerating the support of the Indian market.
As of 2022, Apple's share of the Indian market is only about 4%, which Cook believes is an untapped blue ocean, and will increase investment in the Indian market next. As the proportion of India's middle class continues to rise, consumer demand for mid-to-high-end mobile phones is also expanding, which is believed to help Apple achieve unprecedented sales in India.
Friends, what do you think of Apple's increased support for the Indian market?