Apple is taking a significant step to diversify its manufacturing footprint. The tech giant plans to expand AirPods assembly to India, aiming to mitigate the effects of upcoming tariffs on Chinese imports. Foxconn, a long-standing Apple partner, will spearhead this initiative through its Indian division, according to Bloomberg.
Trial manufacturing has already begun near Hyderabad, with full-scale production slated for early 2025. This move aligns with Apple’s broader strategy to reduce reliance on China, a goal increasingly prioritized in light of geopolitical tensions and economic policies.
India’s Role in Apple’s Global Strategy
India has quickly become a focal point for Apple’s manufacturing ambitions. The company’s efforts in India have already shown success, particularly with iPhone production. As of April 2024, 14% of global iPhone production originated from India, with plans to increase this share to 25% by 2028.
The expansion of AirPods assembly marks another milestone in this trajectory. India offers several advantages, including a skilled workforce and incentives from the Modi administration, which aims to attract global manufacturers.
Challenges and Opportunities
While the shift to India holds promise, it isn’t without challenges. Economic friction between India and China has created hurdles, with India restricting Chinese firms from establishing local facilities. Despite these challenges, Apple has remained committed to scaling operations in India, supported by its suppliers investing over $16 billion in the country since early 2024.
Expanding AirPods production to India could also help Apple compete more effectively in the global market. By leveraging lower production costs and avoiding hefty tariffs, the company can maintain its competitive pricing while sustaining profitability.
A Move to Secure the Future
Apple’s decision to extend AirPods manufacturing to India reflects a strategic response to evolving global trade dynamics. By reducing its dependence on China, the company positions itself to navigate tariffs and geopolitical uncertainties more effectively. With India’s growing role in Apple’s supply chain, the move signals a broader industry trend toward diversified and resilient manufacturing.
