Hon Hai's long-awaited iPhone production line in India has finally fetched positive results. In August this year, the company began to assemble iPhone X devices in the southern parts of Tamil Nadu. Unfortunately, the production line has only the capacity of one million units annually.
This annual number of India iPhone production is quite low compared to the Indian annual market consumption. However, Apple has decided to fulfill the present demand of the Indian market with the help of Indian production line.
Foxconn also is known as Hon Hai Precision Industry Co. is already producing for Xiaomi and Nokia in Andhra Pradesh and Tamilnadu. Now it has also begun assembling iPhone for Indian consumers. According to the sources, until Apple launches its new iPhone model in September, Hon Hai will continue being the local manufacturers and exporters for the Indian markets.
Apple's limitation in India
Most of the Indian consumers prefer Android phones for the low price and availability, whereas iPhones are quite expensive in terms of Indian taste buds. Last year Apple only sold 1.7 million phones in India, which is quite low statistically. On the contrary, iPhones are quite a lot expensive than the cheaper India made Chinese phones, priced almost ten times higher than the Chinese ones.
the price also included high import taxes in terms of Indian iPhone market, but now Apple will like to save up to 20% as the company started to assemble the iPhone line in the Indian land. Therefore, Apple hoped to depend upon Hon Hai in taking into account both the export and the demand of the Indian market. But the Indian government is still refusing to come up with a decision regarding the export tariff for iPhones assembled by Hon Hai. The parent company of the phone has decided to face the demand of the Indian market first till the Fogg clears out with the government.
Sources said, Hon Hai, is currently producing products mostly for the Android users. While the mainland phone brand Xiaomi holds up the capacity of 3 million monthly in terms of production, iPhone still has 36 times lesser annual production capacity compared to Xiaomi. Hon Hai's chairperson Liu Yangwei informed that the company is based in India: through giving 25% of its production line to support the production of US products, iPhone production capacity is still not satisfactory.
The labor capacity is almost near 1000; it will be quite difficult for the company to expand the assembly line at present. Furthermore, iPhone products require high precision in assembly which the Indian labors lack; therefore, they need proper guidance for the time being. As reported, the company is looking into the matter and is ready to take initiatives as soon as possible regarding the production matter.
The company plans to have a negotiation with the Indian government regarding the exporting and hopes to find a solution soon. The employees are going through a training period, following which there will an increase in the workforce. The production will expand gradually. The company officials are also working hard to manage the situation to curve up to the demand due to the trade war.
The price of India made iPhones are likely to be cheaper than that of the imported ones as the report suggests.