Apple Inc exported more than US$2.5 billion of iPhones from India from April to last month, nearly twice the previous fiscal year’s total, underscoring how the US tech giant is accelerating a shift from China with geopolitical tensions on the rise.
Foxconn Technology Group (富士康科技集團), known as Hon Hai Precision Industry Co (鴻海精密) in Taiwan, and Wistron Corp (緯創) had each shipped more than US$1 billion of Apple’s marquee devices abroad in the first nine months of the fiscal year ending in March, people familiar with the matter said.
Pegatron Corp (和碩), another major contract manufacturer for Apple, is on track to move about US$500 million of the gadgets overseas by the end of this month, the people said.
Photo: AFP
Apple’s rapidly growing export numbers illustrate how it is ramping up operations outside of China, where chaos at Foxconn’s main plant in Zhengzhou exposed vulnerabilities in the Cupertino, California-headquartered company’s supply chain and forced it to trim output estimates.
That compounded a broader problem with evaporating demand for electronics as consumers weigh the risks of a global recession.
Apple, the world’s most valuable company, began assembling its latest iPhone models in India only last year, a significant break from its practice of reserving much of that for giant Chinese factories run by its main Taiwanese assemblers including Foxconn.
While India makes up just a fraction of iPhone output, rising exports bode well for Indian Prime Minister Narendra Modi’s plan to make the nation an alternative to China as factory to the world.
Foxconn, Apple’s largest supplier, began building facilities in India more than five years ago in anticipation of a need to extend its geographic range.
One selling point is a raft of new government incentives, a cornerstone of Modi’s drive to make India an electronics manufacturing hub. Foxconn has won 3.6 billion rupees (US$43.7 million) of benefits in the first year of the so-called production-linked incentives scheme, while Wistron’s claims are being processed, the people said.
Apple’s contract manufacturers make iPhones at plants in southern India, but production in the nation is just beginning. About 3 million of the devices were made in India in 2021, compared with 230 million in China, according to Bloomberg Intelligence estimates.
Foxconn began making the iPhone 14 in India a few months ago — sooner than anticipated — after a surprisingly smooth production rollout that slashed the lag between Chinese and Indian output from months to weeks.
Apple’s three Taiwanese partners assemble iPhones 11 to 14 in India, but moving out of China, where Apple has built a deep supply chain for close to two decades, is not easy. A Bloomberg Intelligence analysis estimated it would take about eight years to move just 10 percent of Apple’s production capacity out of China, where about 98 percent of the company’s iPhones are being made.
India tracks production and exports of all smartphone makers who enjoy financial incentives.
Beyond smartphones, the nation is drawing up plans to boost financial incentives for tablet and laptop makers, hoping to woo Apple to make everything from earphones to MacBooks locally.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
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