Apple reportedly pushes Foxconn to invest $1B to expand iPhone manufacturing in India

Posted:
in General Discussion edited July 2020
Taiwanese contract manufacturer Foxconn is reportedly preparing to infuse up to $1 billion into a production facility in India, an investment supposedly made at the behest of Apple.

Foxconn Plant


Citing sources familiar with the matter, Reuters reports Apple is quietly pushing supply partners to expand beyond China amid political tensions and the coronavirus pandemic.

"There's a strong request from Apple to its clients to move part of the iPhone production out of China," one source told the publication.

Foxconn reportedly plans to expand operations at its Sriperumbur plant, which is currently responsible for iPhone XR production. Over the next three years, Foxconn will add models to the facility's assembly list, sources said.

The up to $1 billion infusion will result in some 6,000 jobs, according to the report.

Apple is once again working to diversify its supply chain as the U.S. and China trade war continues. Plans to move portions of the complex system of manufacturers and assemblers out of China have been in the works for years, some reports claim, though Apple's partners only recently began moving toward that goal.

With the world's second-largest smartphone market, India is a juicy target for Apple. Currently, iPhone accounts for approximately 1% of the country's smartphone market, but dominates the ultra-premium segment with an estimated 63% share. Building handsets locally will drive down costs and bypass certain tariffs, making iPhone a more attractive option for Indian buyers.

India has been courting tech companies to enter the country with tax incentives and other stimulus plans, though government promises have only recently borne fruit.
«1

Comments

  • Reply 1 of 35
    SpamSandwichSpamSandwich Posts: 33,407member
    They can do it India but not the US... come on, Tim.
    JWSCmacseekermobird
  • Reply 2 of 35
    FatmanFatman Posts: 513member
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
  • Reply 3 of 35
    65026502 Posts: 380member
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.
  • Reply 4 of 35
    JWSCJWSC Posts: 1,203member
    6502 said:
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.
    You’re both letting your own myopic western upbringing color your perceptions.  Not one of those Indian laborers would think of those jobs as slave labor.  They would be pleased to have those jobs as they would pay well by the standard of every other local job available to those with that skill set.

    As Elon Musk has learned with Tesla, automation technologies have limits when it comes to quality of manufacture.  In some circumstances hand assembly will ensure a higher quality build than is possible with robots.

    BTW, very pleased to see that Apple has made this move.  Would like to see more.
    fahlmanfred1pujones1GeorgeBMacjony0viclauyycanantksundaram
  • Reply 5 of 35
    avs_htxavs_htx Posts: 5member
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    its funny anytime there is a discussion of low cost, it’s called slavery!!!whats two dollars in usa is almost rs 150 per hour in India. Which means more than 25k per month to assemble phones which is a blue collar job. I don’t see any slavery there. Companies that sell product world wide need to reduce their costs as mush as they can. Apple is head quartered in USA but more than half of its sales are outside the country. Same for every company. Also, case in point for American manufacturing costs, read about under armor.
    edited July 2020 fahlmanjony0
  • Reply 6 of 35
    Rayz2016Rayz2016 Posts: 6,957member
    They can do it India but not the US... come on, Tim.
    Yes, they could do it. But then you’d be whining that your phone now costs twice as much. 
    muthuk_vanalingamfred1lkruppmac_dogGeorgeBMacjony0viclauyycanantksundaram
  • Reply 7 of 35
    6502 said:
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.

    I am from India and i agree with @JWSC and @Avs_Htx on this. You SHOULD NOT apply US living standards to India when you evaluate a job opportunity in India. By Indian standards, these are decent paying jobs for those who get it. This is NOT slavery. Slavery by Indian standards is about getting paid 20 cents per hour of work. $2 per hour gives a decent living for the people who are desperate to get a job.
    qwerty52JWSCtmayGeorgeBMacjony0viclauyycanantksundaramRayz2016dewme
  • Reply 8 of 35
    fred1fred1 Posts: 1,108member
    6502 said:
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.

    I am from India and i agree with @JWSC and @Avs_Htx on this. You SHOULD NOT apply US living standards to India when you evaluate a job opportunity in India. By Indian standards, these are decent paying jobs for those who get it. This is NOT slavery. Slavery by Indian standards is about getting paid 20 cents per hour of work. $2 per hour gives a decent living for the people who are desperate to get a job.
    Thank you for your perspective on this. I also wonder if people in India are in a position to refuse “low paying“ jobs. Is the unemployment rate so high that they have no choice?

    Another aspect of this move by Apple is the old adage about putting all your eggs in one basket. It surprises me how many companies have become dependent on China and its relationship with the US rather than looking at other countries where labor is also relatively inexpensive. 

    And one more point: so hiring people in India at these rates is “slave labor”? Then what has it been in China all these years?
  • Reply 9 of 35
    fred1 said:
    6502 said:
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.

    I am from India and i agree with @JWSC and @Avs_Htx on this. You SHOULD NOT apply US living standards to India when you evaluate a job opportunity in India. By Indian standards, these are decent paying jobs for those who get it. This is NOT slavery. Slavery by Indian standards is about getting paid 20 cents per hour of work. $2 per hour gives a decent living for the people who are desperate to get a job.
    Thank you for your perspective on this. I also wonder if people in India are in a position to refuse “low paying“ jobs. Is the unemployment rate so high that they have no choice?

    Another aspect of this move by Apple is the old adage about putting all your eggs in one basket. It surprises me how many companies have become dependent on China and its relationship with the US rather than looking at other countries where labor is also relatively inexpensive. 

    And one more point: so hiring people in India at these rates is “slave labor”? Then what has it been in China all these years?

    Yes, unemployment rate is very high, so people do not have much choice here in India. And right wing politics taking center stage also does NOT help the cause. Regarding China, I think Tim Cook has already answered that question few times. Cheap labor is NOT the PRIMARY criteria for Apple to move to China. The manufacturing ecosystem is the main reason why Apple is dependent on China. "Skilled labor" at "cheap enough cost" at "high volume" is another aspect why Apple is dependent on China. If ANY country can provide a better deal than China in ALL of those aspects, yes apple will significantly reduce their dependency on China.
    GeorgeBMacjony0viclauyycanantksundaramRayz2016ronndewme
  • Reply 10 of 35
    So happy some of you cleared that misunderstanding of slavery up in here. I’ve been part of both moving tech jobs to and from India. And I can verify that they are extremely appreciated there. We left a big hole in their economy when we had to move out of Chennai a couple of years ago. Both white- and blue collar jobs were lost locally. Interviews with former employees showed some of them even lost part of their work pride. It turned out to be high status working for a western hitech company — and we didn’t even pay Apple’s salary levels.
    jony0anantksundaramronn
  • Reply 11 of 35
    lkrupplkrupp Posts: 10,557member
    They can do it India but not the US... come on, Tim.

    Yeah, right. My youngest son is a plant manager at a food processing facility (condiments, sauces, salad dressings). They pay between $15-$20/hr. When the stimulus checks came out he started having attendance problems. Seems more than a few preferred to sit on their asses at home until their stimulus checks ran out. Then they came back to work. The American work ethic in full view.
    muthuk_vanalingamjony0viclauyycanantksundaram
  • Reply 12 of 35
    SpamSandwichSpamSandwich Posts: 33,407member
    lkrupp said:
    They can do it India but not the US... come on, Tim.

    Yeah, right. My youngest son is a plant manager at a food processing facility (condiments, sauces, salad dressings). They pay between $15-$20/hr. When the stimulus checks came out he started having attendance problems. Seems more than a few preferred to sit on their asses at home until their stimulus checks ran out. Then they came back to work. The American work ethic in full view.
    Here’s what I’d like to see Apple do: Sign a deal with a Native American tribe on their sovereign land for manufacturing and assembly work.
    mac_dogjony0dewme
  • Reply 13 of 35
    I think S.Korea, Singapore, Taiwan, Thailand will be better if not US manufacturing.

    Apple needs to think supporting the US economy and stop being selfish, thinking only profit wise. 
  • Reply 14 of 35
    Rayz2016 said:
    They can do it India but not the US... come on, Tim.
    Yes, they could do it. But then you’d be whining that your phone now costs twice as much. 
    Contrary to popular belief, retail prices have very little to do with labor costs. Manufacturing that's done in low wage countries is primarily motivated by higher profit levels, not the ability to offer consumers an attractive price.
    edited July 2020
  • Reply 15 of 35
    lkrupplkrupp Posts: 10,557member
    hazemfive said:
    I think S.Korea, Singapore, Taiwan, Thailand will be better if not US manufacturing.

    Apple needs to think supporting the US economy and stop being selfish, thinking only profit wise. 
    Describe to us what an unselfish corporation is. Give us an example of one such company. Do you want price and profit regulation? Has that ever worked anywhere/anytime in human history? 
  • Reply 16 of 35
    tzeshantzeshan Posts: 2,351member
    They can do it India but not the US... come on, Tim.
    You missed the important point. Apple depends on Foxconn to do the job. No other company can replace it. Not even Tim. 
  • Reply 17 of 35
    65026502 Posts: 380member
    Rayz2016 said:
    They can do it India but not the US... come on, Tim.
    Yes, they could do it. But then you’d be whining that your phone now costs twice as much. 
    Contrary to popular belief, retail prices have very little to do with labor costs. Manufacturing that's done in low wage countries is primarily motivated by higher profit levels, not the ability to offer consumers an attractive price.
    Correct. Tim has even said labor costs contribute little to the overall cost to manufacture the device. It all comes down to how much profit they can make. The more profit they make, the more wall street increases their stock price, the more the stock price goes up, the more money Tim and the executives make. They could care less about helping out poor Indians or Chinese. But, I'm glad I bought Apple stock 20 yrs ago and held it. 
  • Reply 18 of 35
    65026502 Posts: 380member
    6502 said:
    Fatman said:
    I thought the same ...  why not the US! ... then read that 6000 new jobs would be created. Average factory pay in India is about $2/hr - some say even robot cost average $4/hr! As long as slave labor wages are an option, factories that need this many humans will not open in the US.
    Exactly right. Slavery is alive and well in this world. I thought Tim was better than this. Nope. All talk, no walk. When India gets too expensive, they'll build factories in Uganda.

    I am from India and i agree with @JWSC and @Avs_Htx on this. You SHOULD NOT apply US living standards to India when you evaluate a job opportunity in India. By Indian standards, these are decent paying jobs for those who get it. This is NOT slavery. Slavery by Indian standards is about getting paid 20 cents per hour of work. $2 per hour gives a decent living for the people who are desperate to get a job.
    Taking advantage of poor people's desperation, is not much different than slavery.
    ronn
  • Reply 19 of 35
    GeorgeBMacGeorgeBMac Posts: 11,421member
    lkrupp said:
    They can do it India but not the US... come on, Tim.

    Yeah, right. My youngest son is a plant manager at a food processing facility (condiments, sauces, salad dressings). They pay between $15-$20/hr. When the stimulus checks came out he started having attendance problems. Seems more than a few preferred to sit on their asses at home until their stimulus checks ran out. Then they came back to work. The American work ethic in full view.

    While I agree with your main point, in this case it may simply have not been the stimulus check but that they valued their lives more than the $15-$20/Hr.   The food industry jobs have been more dangerous than front line healthcare caring for Covid patients -- because there at least they (mostly) took precautions.
    ronnJWSC
  • Reply 20 of 35
    GeorgeBMacGeorgeBMac Posts: 11,421member
    Rayz2016 said:
    They can do it India but not the US... come on, Tim.
    Yes, they could do it. But then you’d be whining that your phone now costs twice as much. 
    Contrary to popular belief, retail prices have very little to do with labor costs. Manufacturing that's done in low wage countries is primarily motivated by higher profit levels, not the ability to offer consumers an attractive price.

    That's because most manufacturing is done in the countries that do it best and cheapest.   If and when they move production to countries who do not do it best and cheapest you will see either:  margins shrink and/or prices go up.   So, why would they move?  That would be somewhere between dumb and stupid.
    muthuk_vanalingamronn
Sign In or Register to comment.