India may account for 5% of iPhone production volume by spring 2023

in iPhone
Apple's reliance on China is being reduced at a very slow pace, with India set to account for 5% of iPhone production in 2023.

India to slowly take on more iPhone manufacturing
India to slowly take on more iPhone manufacturing

Increasing issues with political instability, worker treatment, and Covid-19 have made China an increasingly unreliable place to do business. Much of Apple's supply chain for iPhone production is situated within the country, however, and that will take time to change.

According to a report from Bloomberg, Apple will have 5% of iPhone production volume performed in India by the spring of 2023. Foxconn, Pegatron, and Wistron have committed to increase that number to 20%, but a timeline wasn't given.

Production facilities aren't the only things that need to be built in India, but supply chain component manufacturers as well. Much of China's dominance in Apple's iPhone production comes from having nearly the entire process performed within the country.

Apple's reliance on China comes from over a decade of investments in Chinese manufacturing infrastructure. Those investments are being made into India, but it is only the start of that process and it could take decades to untangle Apple from China completely.

Bloomberg's note also mentioned that India would be an optimal choice versus other Asian countries because it is a US ally. It would cost about 10% more to do business in India than somewhere like Vietnam, but the geopolitical stability of the country would be a boon.

China's increasing problems with citizen unrest due to the zero-Covid policy will cost Apple millions of iPhone sales in Q4 2022. Foxconn even had to pay rioting workers to leave the company so it could salvage production to some extent.

Estimates place Apple's shipment losses around 6 million to 9 million units for Q4. These are the effects of having so much reliance on a single country, and Apple seems more eager than ever to reduce that reliance.

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