Foxconn to Invest $700M in New Indian Plant, Highlighting Manufacturing Shift Away from China

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Foxconn Technology Group are planning to invest around $700 million in a new factory in India to boost local production. This move highlights the acceleration of manufacturing shift from China amidst the Washington-Beijing tensions.

The Taiwanese company, also known for its reliable unit Hon Hai Precision Industry Co., plans to build a factory for iPhone components on a 300-hectare land near the airport in Bengaluru, the capital of Karnataka state in southern India, as per sources.

The factory is expected to assemble Apple handsets, some sources stated. Moreover, Foxconn can also use the land to produce some components for its electric vehicle business.

This investment is one of the biggest expenditures by Foxconn in India and underscores how China risks losing its status as the world's biggest electronics producer.

Apple and other US brands are now exploring alternative locations such as India and Vietnam instead of China due to global supply chain barriers during the pandemic and the Ukraine conflict.

The new production location in India is estimated to create around 100,000 jobs, according to the sources. The big Apple iPhone assembly complex in Zhengzhou, China, employs around 200,000 workers.

Output at the Zhengzhou factory dropped before the year-end holiday due to Covid-related disruptions, prompting Apple to review its supply chain dependence on China.

The plan is still subject to change as Foxconn is still in the process of finalizing the investment and project details, the sources added. It is also unclear whether the factory represents new capacity or production shifted from other sites, such as its Chinese facilities.

India has offered financial incentives to Apple partners like Foxconn, which started making the latest iPhone generation at a location in Tamil Nadu last year. Wistron Corp. and Pegatron Corp. have also ramped up production in India, while suppliers like Jabil Inc. have started making AirPods components locally in India.

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