Here’s how Apple is striving with its ‘Made in India’ gameplan

Shipments of iPhones manufactured in India grew 162% YoY in value, signaling the efforts to boost Indian production of Apple products are paying off.
8 April 2023

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The Indian government has been pushing and encouraging smartphone companies to produce in India, and that has successfully pushed the number of “Made in India” phones higher. Even Apple’s ‘Made in India’ push seems to be paying off as data shows Indian iPhone units made and volume shipped soaring to levels never-seen before. 

A look into Counterpoint Research’s data shows that the shipment value of Indian-made iPhones grew 162% year-on-year (YoY) in 2022 while volume rose by 65%. Since Apple has begun diversifying its production out of China, the tech giant has been centering its efforts on India as a location for production of iPhones and accessories. 

In fact, just last month, one of India’s top government officials shared that Apple Inc. is looking to boost production in India, with the help of its partner Foxconn, to around a quarter of its global total. Currently, India’s southern Tamil Nadu state is where Foxconn operates the nation’s largest iPhone plant.

But even at the rate that Apple was accelerating its Indian production in 2022, the company has managed to capture 25% of the total value of the smartphone market in India, an impressive feat from a mere 12% in 2021. In fact, Counterpoint’s Research Director Tarun Pathak  attributed the drivw of locally manufactured shipments within India in 2022 to increasing exports from Apple, among others, which somewhat offset the impact of local demand decline.

To put things into context, all the while, China has produced up to 85% of iPhones globally, but has been at risk of losing its dominance as Apple takes steps to diversify its manufacturing supply chain. Besides India, Apple has also extended into Vietnam for AirPods and Mac assembly, upped its ante in Malaysia for some Mac production, and Ireland—where suppliers currently build the relatively easy-to-produce iMacs—for a range of simpler products.

The iPhone maker is placing big bets on the South Asian nation. So much so that Apple is expected to open its first official retail store in India sooner rather than later. Without indicating its opening date, Apple released an image that shows the store in Mumbai’s main business district. 

India, which is also the world’s second-largest smartphone market, is seeing overall local manufacturing boosted due to the recent disbursement of the phased manufacturing program and the production-linked incentive (PLI) scheme from the government, as well as other initiatives, both at the central and state levels. 

Pathak noted that India is seeing multiple companies investing in the country and expanding their manufacturing base. “Also, the component and semiconductor ecosystem is witnessing investment growth due to the government’s continuous efforts,” he added. Pathak said India was reaping more benefits of the PLI scheme, especially thanks to increasing exports from Apple and Samsung

How are other Made-in-India smartphones doing?

Unfortunately, due to the softening of consumer demand brought by  macroeconomic headwinds, especially in the second half of 2022, Counterpoint Research said ‘Made in India’ smartphone shipments declined 3% for the whole of 2022. The shipments fell 19% YoY in the last quarter, also due to local demand decline, particularly in the entry-tier and mid-tier segments. 

However, in terms of value, ‘Made in India’ smartphone shipments registered 34% YoY growth, mainly due to increasing premiumization coupled with the increasing export of premium smartphones, especially from Apple. As for the contribution of exports in the total ‘Made in India’ smartphone shipments, it reached the highest ever in 2022 in both volume (20%) and value terms (30%).