Apple Expands Supplier Network in India

Apple Inc. is making significant strides in expanding its supplier network in India. The tech giant has initiated discussions with Bharat Forge, a prominent manufacturing company under the Kalyani Group. This potential collaboration aims to have Bharat Forge produce various components and mechanics for Apple. This move is part of Apple’s broader strategy to enhance local manufacturing capabilities while reducing its reliance on Chinese suppliers. Over the past two years, Apple has actively sought to strengthen its presence in India, aligning with the country’s growing manufacturing sector.

Strengthening Local Partnerships

Apple’s discussions with Bharat Forge come on the heels of existing partnerships with other Indian companies. Notable collaborations include the Tata Group, Motherson Group, and Aequs. These partnerships are crucial for Apple as it aims to diversify its supply chain and increase local value addition. According to sources, talks with Bharat Forge are progressing, with the company based in Pune, Maharashtra, being a key player in the manufacturing sector.

Bharat Forge employs around 5,000 people and operates in various industries, including automotive, energy, and aerospace. Under the leadership of Baba Kalyani, the company has established itself as a significant force in Indian manufacturing. By collaborating with Bharat Forge, Apple is not only tapping into local expertise but also contributing to the growth of the Indian manufacturing ecosystem. This partnership could lead to the creation of more jobs and enhance the skill set of the local workforce.

Apple’s Manufacturing Footprint in India

Apple’s manufacturing presence in India is already substantial. The company operates three iPhone assembly facilities, with Foxconn managing the largest one in Tamil Nadu. Additionally, Tata Group units run two other facilities in Tamil Nadu and Karnataka. This robust manufacturing setup allows Apple to produce a significant number of iPhones locally, thereby reducing shipping costs and lead times.

The expansion of Apple’s supplier network is also reflected in its current vendor relationships. Companies like Sunwoda, Foxlink, and Aequs are already part of Apple’s supply chain, providing essential components such as battery packs and cables. Furthermore, Amperex Technology Ltd (ATL), another major supplier, is set to begin battery cell production at its facility in Manesar, Haryana. This growing network of suppliers is crucial for Apple’s goal of achieving higher local value addition in its products.

Local Value Addition and Economic Impact

Apple’s commitment to increasing local value addition in its manufacturing process is evident. The company has achieved a remarkable 20% local value addition across various iPhone models. This is a significant improvement from the initial 5-8% local value addition when manufacturing began under the Production-Linked Incentive (PLI) scheme in 2020. The PLI scheme aims to boost domestic manufacturing and attract global companies to set up operations in India.

In 2024, Apple manufactured iPhones worth $17.5 billion and achieved exports totaling $12.8 billion. This impressive figure underscores the economic impact of Apple’s operations in India. By fostering local partnerships and expanding its supplier network, Apple is not only enhancing its manufacturing capabilities but also contributing to India’s economic growth. The company’s efforts are likely to inspire other global firms to explore similar opportunities in the Indian market.

Future Prospects and Industry Trends

As Apple continues to expand its supplier network, industry experts anticipate that more local suppliers will join its ecosystem. The focus on iPhone enclosures suggests that additional collaborations may emerge within the next year. This trend aligns with Apple’s strategy to enhance local manufacturing and reduce its dependence on foreign suppliers.

Moreover, the Indian government’s push for self-reliance in manufacturing is creating a conducive environment for companies like Apple. With international suppliers from countries like China, Japan, and Taiwan already establishing manufacturing units in India, the landscape is becoming increasingly competitive. As Apple solidifies its presence in India, it sets a precedent for other tech giants to follow suit.

 


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