Iphone Factory ChinaSource: Apple

What you need to know

  • Another Apple supplier is looking to India.
  • Pegatron has registered an Indian subsidiary in Chennai.
  • It is looking to follow Wistron and Foxconn in expanding iPhone operations in the country.

Apple supplier Pegatron has registered its India subsidiary in Chennai, signaling its intent to invest in manufacturing in the region.

As reported by The Economic Times:

Pegatron, Apple's second-largest contract manufacturer, has registered a subsidiary in India, setting the stage for expanding the manufacturing capacity of iPhones in the country, amid heightened US-China tensions.

A person familiar with the development told ET that Pegatron had registered a subsidiary in Chennai and that currently, company officials were holding talks with "multiple state governments" in order to find land for setting up factories. After the land is secured, it will begin importing plant and machinery.

As the report notes, Pegatron is one of three major suppliers for Apple's iPhone. The other two, Foxconn and Wistron have already set up operations in the region.

A recent story suggested that Foxconn is planning to invest $1 billion in India to move iPhone production to the country at the behest of Apple. From that report:

Reported by Reuters, Foxconn, who assembles the iPhone for Apple, is planning to invest $1 billion to expand its production capabilities in India. One of the sources, who asked to remain anonymous, says that Apple has been pushing its supply chain partners to move part of their production out of China.

Apple has reportedly held several meetings with the Indian government as it plans to take 20% of its production to the country, a slice of manufacturing thought to be worth around $40 billion over the next five years.

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Several changes by the Indian government have made manufacturing in the country more desirable, including changes to the way plant machinery and equipment is valued upon import, and incentives of up to 6% on incremental sales for up to five years if Apple makes at least $10 billion worth of iPhones.