New Delhi: Foxconn, the Taiwanese supplier for Apple, has announced plans to increase its production yield in India. During the earnings call that followed the release of its quarterly results, Hon Hai head Young Liu revealed the company’s intentions to expand assembly and component operations in India. He stated that India’s population of 1.4 billion people presents a large potential market for mid-to-high-end products that Foxconn’s clients are focusing on.
Liu emphasized that India’s labor cost gives it an upper hand, and many manufacturers are investing in the country. To increase its competitiveness in the market, Foxconn will continue to apply for government incentives, as it did last year. However, investing in new regions like India comes with its own set of challenges. Liu highlighted language, culture, manufacturing capabilities, and supply chain completeness as some of the issues they are prepping up for.
To overcome these challenges, the company has purchased 300 acres of land in Bengaluru’s Devanahalli taluk near the city’s international airport at 3 billion rupees. Liu also acknowledged the stiff competition in the Indian market, but he pointed out that many players are still in the learning phase. Foxconn has gained an advantage in the market due to its experience managing local employees, supply chain, and logistics since it entered the Indian market in 2006.
The company’s plans to expand to India have received support from the government. Karnataka Chief Minister Basavaraj Bommai announced earlier this year that Foxconn would “soon” manufacture iPhones in the state and create around 100,000 jobs. Furthermore, Foxconn head Young Liu met with PM Narendra Modi to discuss enhancing India’s tech and innovation eco-system.
In conclusion, Foxconn’s decision to increase production yield in India is a strategic move to tap into the country’s large potential market. While there may be challenges, the company’s experience and government support give it an advantage over its competitors.
