Apple is planning to move production away from China as Foxconn is considering investing to expand an iPhone assembly factory in southern India. The move comes from “a strong request from Apple,” according to Reuters.
The investment is said to be worth up to $1 billion, as revealed by two unnamed sources with knowledge of the matter. The shift of this scale away from China is due to the trade tension between China and the United States.
The Sriperumbudur plant, which is about 50 km west of Chennai, currently manufactures iPhone XR, and will be expanding to assemble additional iPhone models. The expansion will extend over the course of three years, creating some 6,000 new jobs in the state of Tamil Nadu, one of the sources said.
Manufacturing iPhones in the country will help lower their cost as the import taxes from the price tags will be excluded. Only 1% of smartphone sales in India, the world’s second-biggest smartphone market, are from iPhones as of now.
“With India’s labour cheaper compared with China, and the gradual expansion of its supplier base here, Apple will be able to use the country as an export hub,” Neil Shah of Hong Kong-based tech researcher Counterpoint said.
Earlier this year, Samsung also announced it would be setting up a smartphone display manufacturing unit on the outskirts of New Delhi with an investment of $500 million.
Apple and Foxconn didn’t respond to Reuter’s request for comment.