Foxconn gears up to make flagship iPhones in India

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iPhone XS Max vs. iPhone XS size: Sometimes bigger really is better.
Designed in California, built in India.
Photo: Ste Smith/Cult of Mac

Foxconn is reportedly “within weeks” of starting trial production of the iPhone XS in India, Bloomberg reports.

Manufacturing will take place at a Foxconn factory in the southern city of Chennai. Rival manufacturer Wistron already makes the iPhone 6s, iPhone SE and — now — the iPhone 7 at its own facility in Bangalore.

It’s not clear from the report whether the iPhone XS-series devices will initially be for sale only in India. This has been one of the main reasons for producing iPhones in the country. (That lets Apple avoid import charges designed to promote local manufacturing.) Ramping up production in India could also give Apple a second established manufacturing hub in the event that the trade war with China makes manufacturing untenable there.

Longer term, it seems that Apple’s Indian production line will target international sales. The story notes that, by the time Apple announces its new iPhones in September, Foxconn’s India assembly line will be ready for “local and export markets.” Foxconn will initially invest around $300 million to get the production line going. More money will follow in the future.

Apple’s challenges in India

The Bloomberg report additionally shines a light on Apple’s struggles to succeed in India. While people bought upward of 140 million smartphones in the country last year, just 1.7 million of them were iPhones.

This largely comes down to the iPhone’s large price tag. Xiaomi’s Redmi Note 7 handset currently sells for about one-tenth the cost of the iPhone XS.

In the first couple months of 2017, Apple reportedly shipped around 15,000 devices to India. The company is likely to see a 50 percent drop this quarter versus the same quarter last year.

Source: Bloomberg