ASIA: Apple’s iPhone exports from India significantly increased by one-third in the six months leading up to September.
The US firm exported nearly US$6 billion (S$7.95 billion) worth of iPhones made in India, marking a one-third increase in value compared to the previous year, according to sources who wished to remain anonymous.
If this trend continues, annual exports could surpass roughly US$10 billion (S$13.24 billion) for the fiscal year 2024, The Business Times reports.
The company is rapidly expanding its manufacturing capabilities in India, taking advantage of local subsidies, a skilled workforce, and improving technological resources.
India plays a crucial role in Apple’s strategy to reduce dependence on China, where operational risks have grown due to increasing tensions between the US and China.
Three of Apple’s main suppliers, Taiwan’s Foxconn Technology Group, Pegatron, and India’s Tata Electronics, assemble iPhones in southern India.
Foxconn, located just outside Chennai, is the leading supplier in the country, accounting for half of India’s iPhone exports.
Tata Group’s electronics division exported around US$1.7 billion (S$2.25 billion) in iPhones from its factory in Karnataka from April to September.
This marked a significant milestone as Tata became the first Indian assembler of Apple’s popular product after acquiring its unit from Wistron last year.
The reported dollar figures reflect the estimated factory gate value of the devices, not the retail prices.
According to federal trade ministry data, iPhones have become vital to India’s smartphone exports, helping the category emerge as the top export to the US, valued at US$2.9 billion (S$3.84 billion) in the first five months of the current fiscal year.
This is an increase from just US$5.2 million (S$6.89 billion) in annual smartphone exports to the US five years ago before Apple ramped up its manufacturing efforts in the country.
Despite this growth, Apple holds just under 7 per cent of India’s smartphone market, largely dominated by Chinese brands like Xiaomi, Oppo, and Vivo.
While the Indian market is still relatively small for iPhones on a global scale, Apple continues to make big bets.
Support from the Indian government, especially under Prime Minister Narendra Modi, has been crucial in helping Apple produce its high-end iPhone 16 Pro and Pro Max models in India this year.
These models feature enhanced cameras and premium titanium bodies. Apple is also looking to expand its retail presence, with plans for new stores in tech hubs like Bangalore and Pune.
In 2023, Apple CEO Tim Cook launched the company’s first retail locations in Mumbai and New Delhi, marking a significant step for the brand in India.
The recent store openings, combined with an aggressive online sales strategy and a growing middle class eager to own Apple products, helped boost the company’s annual revenue in India to a record US$8 billion (S$10.6 billion) for the year ending March.
This increase in Apple’s success in India contrasts with the challenges it faces in China, where economic growth has slowed following strict COVID-19 lockdowns and ongoing property market issues.
While Apple continues to rely heavily on China for a significant portion of its manufacturing and sales, it is clear that India is becoming an increasingly important part of its global strategy.
In the fiscal year ending March 2024, Apple assembled around US$14 billion (S$18.54 billion) Â worth of iPhones in India, doubling its production and accelerating efforts to diversify its manufacturing base beyond China.
Approximately US$10 billion (S$13.24 billion) of this total was exported. /TISG
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