Foxconn plans to invest up to $1 billion to expand a factory in Sriperumbudur, near Chennai, where the Taiwanese contract manufacturer assembles Apple iPhones, two sources said.
The move, the scale of which has not previously been reported, is part of a quiet and gradual production shift by Apple away from China as it navigates disruptions from a trade war between Beijing and Washington and the coronavirus crisis. “There’s a strong request from Apple to its clients to move part of the iPhone production out of China,” a source with direct knowledge told Reuters.
Foxconn said it does not comment on matters related to customers, while Apple did not respond to a request for comment. Foxconn’s planned investment in the Sriperumbudur plant, where Apple’s iPhone XR is made, will take place over three years, the second source said.
Some of Apple’s other iPhone models made by Foxconn in China will be made at the plant, said both sources, who declined to be identified as the details have yet to be finalised. Taipei-headquartered Foxconn will add some 6,000 jobs at the Sriperumbudur plant under the plan, one of the sources said. It also operates a separate plant in Andhra Pradesh, where it makes smartphones for China’s Xiaomi Corp, among others.
Foxconn chairman Liu Young-way last month said it would ramp up its investment in India, without giving details. Apple accounts for about 1% of smartphone sales in India, the world’s second-biggest smartphone market. Building more phones in India will also help Apple save on import taxes that further push up its prices.
Apple assembles a few models through Taiwan’s Wistron Corp in Bengaluru. Wistron is also set to open a new plant, where it plans to make more Apple devices.