Business Standard: May 18, 2017
Bengaluru: Buyers of Apple iPhone SE could soon find a “Made in India” tag on their devices. Taiwanese contact manufacturer Wistron would be making it at their plant in Bengaluru.
The company recently conducted a trial run at the factory. The few phones made during the trial run will be in stores in two weeks.
Full-scale production will take more time, according to a person familiar with Apple’s plans. The global tech major confirmed the production at the sole facility in India.
“We are beginning initial production of a small number of iPhone SEs in Bengaluru. We’ll begin shipping to domestic customers this month,” Apple said in an email.
Karnataka was quick to claim credit for this. Its Information Technology Minister Priyank Kharge said, “It shows the Bengaluru ecosystem is able to attract the world’s best companies. If the Make in India initiative has to work, we need to incentivise manufacturers to gradually increase local sourcing.”
Apple Chief Executive Officer Tim Cook visited India last May and met Prime Minister Narendra Modi. They reportedly discussed manufacturing of iPhones in India, for the local market and export. Since then, the government has turned down Apple’s demands for tax sops. But, the fast-growing domestic market seems too attractive for the company.
With a dip in iPhone sales in developed markets like the US and China, India is now a major focus for Apple. Since the country’s appetite for expensive flagship devices is still small, Apple continues to produce its four-year-old iPhone 5s to compete with Xiaomi, Motorola, Samsung and others in the mid-level market.
Is domestic production going to cut prices? There is no clarity on that yet. Experts said assembling devices locally will help it save 12 per cent in taxes.
One can buy an iPhone SE for Rs 27,200 but on Flipkart and Amazon, it is available for as low as Rs 20,999. Apple is known to maintain price parity across the world. In the US, the iPhone SE starts at $399 (about Rs 25,000).
“Prices might go below Rs 20,000 only in October,” said Neil Shah, research director, devices and ecosystems, Counterpoint Research. “At that price it has to compete with Chinese rivals Oppo and Vivo.”
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.