Tata Group is on the verge of finalizing a deal to purchase a factory owned by Apple
This groundbreaking agreement would mark the first instance of an Indian company entering the iPhone assembly domain, according to insiders familiar with the matter. The acquisition of the Wistron Corp. facility in Karnataka state, with an estimated value exceeding $600 million, follows nearly a year of negotiations. The plant currently employs over 10,000 workers who are responsible for assembling the latest iPhone 14 model.
The Tata Group has been diligently conducting due diligence on the Wistron facility for a significant period. Although there are some pending issues being resolved, progress is being made in that regard.
Wistron has committed to delivering iPhones worth a minimum of $1.8 billion from the factory during the fiscal year until March 2024, in order to secure state-backed financial incentives. Additionally, Wistron plans to triple the workforce at the plant by next year. As Wistron exits the Indian iPhone business, Tata Group is poised to honor these commitments.
Representatives for Tata, Wistron, and Apple have chosen not to comment on this matter.
The introduction of an Indian-made iPhone is expected to fuel Apple’s endeavors to diversify its production beyond China and establish a stronger technology manufacturing presence in India. Wistron alone exported nearly $500 million worth of iPhones from India in the last quarter. Apple’s other significant Taiwanese suppliers, Foxconn Technology Group and Pegatron Corp., have also expanded their local operations.
India has made substantial progress in domestic manufacturing since Prime Minister Narendra Modi launched government programs with attractive financial incentives to boost production and employment. In response to the COVID-19 pandemic and escalating tensions between the US and China, Apple has intensified its efforts to reduce its reliance on China by diversifying its manufacturing locations.
The presence of an Indian company manufacturing iPhones could significantly bolster Modi’s ambitions to challenge China’s status as the global manufacturing hub. Furthermore, it may encourage other international electronics brands to consider production in India, reducing their dependence on China.
With a 155-year legacy, Tata Group is involved in diverse sectors ranging from salt to tech services. In recent years, the conglomerate has made strides in electronics production and e-commerce, venturing into relatively new territories for the Tata family. They already manufacture iPhone chassis at their sprawling factory in Tamil Nadu, and Chairman N Chandrasekaran has expressed the group’s aspirations in chipmaking.