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iPhone 14 to be manufactured in India, but does that mean cheaper iPhones?

Apple is shifting iPhone 14’s manufacturing from China owing to ongoing geopolitical tensions between the US and China.

Published:Wed, August 24, 2022 6:30pm

By Md Waquar Haider

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Cupertino-based tech giant Apple is reportedly planning to start manufacturing iPhone 14 in India. According to a Bloomberg report, Apple is shifting iPhone 14's manufacturing out of China owing to ongoing geopolitical tensions between the US and China. Apart from reducing Apple's dependency on China, this move will provide a major manufacturing boost to India. However, for consumers in India, it may not really mean cheaper iPhones.

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"It's good to see Apple bringing its latest model to India for manufacturing that not only reinforces Apple's India commitment but also adds a star to Make in India. This will also argue well with the exports story, especially after the implementation of PLIs. For consumers, it however it may not mean getting cheaper iPhone than those imported," Faisal Kawoosa, founder analyst at TechArc told BGR.in on Wednesday.

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Earlier this year, Apple also set a target of manufacturing iPhones worth Rs 47, 000 crore in India in the fiscal year 2022-23. The made-in-India iPhone 14 will be available by Diwali. Notably, Apple hasn't announced the iPhone 14's plans to be manufactured in India. Apple is already manufacturing iPhone 13 in India at the manufacturing plant of its partners Foxconn, Wistron, and Pegatron. Despite this, the iPhone 13's pricing remains at Rs 79,900, the same as it was at launch. Similar to the iPhone 13, the price of the iPhone 14 might not go down after it is produced domestically in India.

"Manufacturing iPhone 14 in India also Makes sense considering Apple's growth plans focused on India. But at the same time one should not expect that saving to be passed on to the consumer immediately, at launch or even when India-made units start hitting the market," Navkender Singh, Research Director, IDC noted.

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Earlier this month, noted Apple analyst Ming Chi Kuo noted that Apple plans to use Foxconn's iPhone manufacturing facility in India to ship the 6.1-inch iPhone 14 model "almost simultaneously with China for the first time in 2H22". As reported in the past, the iPhone 14 lineup will consist of a 6.1-inch iPhone 14, a 6.7-inch iPhone 14 Max, a 6.1-inch iPhone 14 Pro, and a 6.7-inch iPhone 14 Pro Max. Apple may also introduce three new Apple Watches, including the Watch 8, a budget Watch SE model, and even a new Watch Extreme Edition along with AirPods Pro 2 at the event.

"An earlier-than-usual production of Apple iPhone 14 in India will fasten the product time to market, and further fuel Apple's ongoing growth momentum in India. Coupled with aggressive marketing initiatives, Apple will be able to hit the right strides leading up to the all-important festive season," Prabhu Ram, head-Industry Intelligence Group (IIG), CyberMedia Research (CMR), mentioned.

Apple has weathered the pandemic-era slumps well. Mac shipments, for instance, grew in the first quarter of 2022, even though the broader PC market slumped. In the second quarter of 2022, Apple saw its best market share since 2012, holding 16 percent of the global market. Apple's iPhone also took 62 percent of the first quarter's global market share for devices costing over $400, suggesting that Apple's target audience is still willing to spend on a high-end device. Now, made-in-India iPhone 14 will further boost the company's performance.

"It will help Apple save on ~20% import duty but at the same time, we don't expect Apple to pass on everything to consumer as there are other variables at play here as well. Plus this will also help apple EMS players to reach their PLI targets faster," Tarun Pathak, Research Director, Counterpoint Research concluded.

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