Apple’s efforts to reduce its reliance on China by increasing production in India have hit a roadblock, according to a report published in the Financial Times. The report highlights the challenges faced by the tech giant in its efforts to establish its supply chain in the country. Apple has been sending engineers and product designers from California and China to factories in southern India to train locals and help establish production. This is in line with the company’s efforts to diversify its supply chain strategy, following months of Covid-19 disruption that led to a decline in quarterly revenues.
While Apple has been producing lower-end iPhones in India since 2017, last September was significant, with Indian suppliers building flagship models within weeks of their launch in China. However, its experience in recent months has demonstrated the scale of the work to be done in the country. The report states that at a casings factory in Hosur run by Indian conglomerate Tata, just about one out of every two components coming off the production line is in good enough shape to eventually be sent to Foxconn, Apple’s assembly partner for building iPhones, according to a person familiar with the matter. This 50 per cent “yield” fares badly compared with Apple’s goal for zero defects.
The report highlights that operations in India are not running at the pace seen in China, where suppliers and government officials took a “whatever it takes” approach to win iPhone orders. Apple...
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