According to two people, Apple Inc.’s (AAPL.O) Taiwanese supplier Pegatron Corp (4938. TW) is discussing establishing a second India facility.
The sources, who requested anonymity because the negotiations are private, said Pegatron wants to construct a second plant outside Chennai in Tamil Nadu state six months after opening the first with a $150 million investment.
The initial source indicated the new plant “assembles the newest iPhones.”
“Any acquisition of assets would be declared based on requirements,” Pegatron stated, declining to elaborate.
Apple refused to comment.
Apple’s growth frontier in India. According to the India Cellular and Electronics Association, India shipped $9 billion worth of cell phones between April 2022 and February this year, with iPhones accounting for almost 50%.
Counterpoint says Pegatron produces 10% of Apple’s iPhones in India annually.
Apple and its suppliers are moving production out of China to escape the fallout from Sino-U.S. trade tensions. Pegatron is expanding across Southeast Asia and North America.
Pegatron is discussing leasing a second factory in Mahindra Global City in Chennai, which opened its first unit in September 2022.
Pegatron’s growth investment is unclear. However, the initial source indicated the new factory would be smaller than the previous one.
Apple Inc. has staked big on the South Asian nation since it launched iPhone production in 2017 via Wistron and then Foxconn (2317. TW) of the Indian government’s desire for local manufacturing.
Apple aims to build iPads and AirPods in India, the second-largest smartphone market.
Last week, India’s Karnataka state authorized Foxconn’s $968 million investment, creating 50,000 employees.
After securing a contract, Foxconn wants to establish a $200 million facility in India to make Apple’s wireless headphones, Reuters reported last week. Its Tamil Nadu facility assembles several iPhone models.
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