[News] Tata Reportedly Partners with Pegatron for iPhone Assembly in India

India’s Tata Group is reportedly in discussions with Taiwanese electronics manufacturer Pegatron to establish a joint venture, with the intention of co-managing the Apple iPhone assembly plant currently under construction in the southern state of Tamil Nadu. The partnership is anticipated to hasten the growth of iPhone production capacity in India.

According to Reuters citing industry sources, Tata, having acquired an iPhone assembly plant in the southern state of Karnataka from the Taiwanese company Wistron in 2023, has officially become part of the iPhone supply chain in India.

On the other hand, the new facility in the city of Hosur, Tamil Nadu, will be Tata’s second iPhone assembly plant in India, featuring 20 production lines, as disclosed by sources cited by Reuters.

Amid rumors that Tata Group in India is deeply engaged in discussions with Pegatron to form a strategic alliance and establish a joint venture, Pegatron did not to respond to market speculations.

Currently, approximately 10% of Apple’s iPhone production capacity in India comes from Pegatron, with the vast majority of capacity originating from Foxconn’s iPhone assembly plant located in Karnataka.

Furthermore, Foxconn has the highest share in Apple’s current new iPhone assembly. Among the four iPhone 15 series models, only certain models like iPhone15 and iPhone15 plus are produced by Tata Group in India.

An industry source has reportedly stated, “Tata cannot build everything from scratch,” He indicated that after Tata establishes a joint venture with Taiwanese firm Pegatron, Pegatron will provide technical and engineering support.

In recent years, Pegatron has been consistently expanding its global footprint, with expansions ongoing in Taiwan, Mexico, Indonesia, India, Vietnam, and other locations.

Regarding its operations in India, Pegatron announced in late October 2023 that it had invested approximately NTD 300 million (roughly USD 9.56 million) to secure leasing rights for factory premises in Tamil Nadu.

In January of this year, the Indian subsidiary announced signing a construction general contracting project to commence electromechanical engineering construction for a new plant, totaling approximately NTD 510 million (roughly USD 16.26 million). According to industry sources, Pegatron’s Indian facilities primarily focus on smartphone production at present.

(Photo credit: Apple)

Please note that this article cites information from Reuters.


[News] Interim CEO and CFO of Vivo India Company, Among Other Executives, Arrested

Recently, as Indian media cited anonymous sources, that the Indian law enforcement agency arrested three executives of Vivo India Company on charges of alleged involvement in a money laundering case.

As per The Times of India, the individuals arrested by the Indian law enforcement agency in this case are Hong Xuquan, the interim CEO of vivo India, along with Harinder Dahiya, the CFO of Vivo India, and the company consultant Hemant Munjal.

The three have been taken into custody under the provisions of the Prevention of Money Laundering Act (PMLA). Reportedly, an ED spokesperson did not immediately respond to a request for a comment. Furthermore, the Vivo employees is said to be appear in court on December 26.

Vivo spokesperson has responded accordingly that, “We are deeply alarmed by the current action of the authorities. The recent arrests demonstrate continued harassment and as such induce an environment of uncertainty amongst the wider industry landscape. We are resolute in using all legal avenues to address and challenge these accusations.”

According to The Times of India, in October of this year, the Indian law enforcement agency arrested four individuals, including Vivo’s chartered accountant Nitin Garg.

The report further states that from 2014 to the present, Vivo India has been allegedly probing suspicious transactions, which were remitted by the company to China from Rs 1.25 lakh crore of receipts from its Indian operations since 2014

“Various Chinese nationals have been traveling across India, including sensitive places of Jammu and Kashmir and Ladakh, in gross violation of Indian visa conditions.” the agency added.

Previously, as per  Hindustan Times, the Indian government banned numerous Chinese apps, accusing them of being “prejudicial to the sovereignty and integrity of India, defence of India, security of the state and public order.” Since June 2020, more than 200 Chinese apps, including popular ones such as TikTok, WeChat, and UC Browser, have been banned.

The government has also stated in its parliament indicating that, Chinese smartphone makers, including Xiaomi, Realme, Oppo, and Vivo, have been found evading taxes to the tune of Rs 9,000 crore in India.

(Photo credit: Vivo)

Please note that this article cites information from Hindustan Times and The Times of India


[Insights] The Battery Supply for iPhone 16 Might Come from India, with Safety Remaining the Top Priority

According to a news report from Financial Times, Apple has reportedly informed its supply chain, including battery suppliers such as China’s Desay Corporation and Taiwan’s Simplo Technology, of its inclination to shift the battery supply for the iPhone 16 to India. Apple is encouraging suppliers to relocate existing production capacity to India to expand production scale in the region.

TrendForce believes that, given the critical nature of battery components in terms of user safety, any error in battery assembly is unacceptable. As Apple’s certainty about production yields in India remains unclear, this move carries certain risks.

Apple Expedites iPhone Assembly Business Transfer to India to Mitigate Geopolitical Risks

As the world’s most valuable company, Apple’s supply chain strategy has always been a key factor in its success. Amidst geopolitical tensions between the U.S. and China, Apple faces significant pressure from both the investment community and U.S. policymakers to diversify its supply chain, prompting an acceleration in the transfer of iPhone assembly operations.

In recent years, Apple has been shifting part of its iPhone assembly business from China to India to mitigate production risks.

The choice of India as a manufacturing destination is influenced not only by its large and untapped population but also by proactive subsidy policies implemented by the Indian government, aiming to position India as an attractive manufacturing and export hub for multinational companies.

Additionally, the growth potential of the iPhone in the Indian market adds to the appeal of relocating iPhone production to India. 

Increased Risks as Battery Component Production Shifts to India amid Uncertain Yield Rates

Analyzing the manufacturing distribution for Apple’s iPhone 15 series in 2023 reveals Foxconn’s predominant role, with only specific Plus models being produced by India’s Tata Group.

This strategic move, based on TrendForce’s insight, is inferred to be influenced by the Plus models’ lower sales performance in previous generations and their specific product positioning. Apple seems cautious about shifting production to India entirely until the production standards of Indian manufacturing facilities are confirmed, especially for models with comparatively lower demand.

In the ever-evolving landscape of smartphone components, such as core processors and camera modules, upgrades occur almost annually. However, the upgrade pace for smartphone batteries has been notably slower.

This delay is attributed to the critical importance of safety in battery components. Given the potential risks to user safety, even a minor error in battery components could lead to significant harm to a smartphone brand.

Considering this, the manufacturing distribution for Apple’s iPhone 15 series suggests that Apple might not be entirely confident in the production yield rates in India.

If the decision to shift the production of batteries, which requires a special emphasis on safety, to India is solely driven by the need to mitigate geopolitical uncertainties, it indeed poses a certain level of risk for Apple.

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[News] Tata Group Plans to Build New iPhone Assembly Plant in India, Aligning with Apple’s Localization Strategy for the Supply Chain

Apple’s iPhone is gaining even more popularity in India, with Tata Group, India’s conglomerate, reportedly preparing to build a new iPhone assembly plant. According to Bloomberg, this move aligns with Apple’s broader manufacturing strategy expansion in India.

Previously reported by TrendForce, Apple’s decision to opt for India is primarily due to the fact that since 2015, India has become the fastest-growing regional market for smartphones globally. Earlier in October this year, Tata Group officially acquired Wistron’s subsidiary in Bengaluru, primarily responsible for assembling orders for the iPhone 14. 

According to sources from Bloomberg, Tata Group is not only recruiting new staff for this facility but also planning to build the largest iPhone assembly plant in the town of Hosur, Tamil Nadu, India.

The new facility is expected to establish 20 assembly lines, planning to employ approximately 50,000 workers within the next 2 years. It is slated to be operational within 12 to 18 months. However, the existing government-supported PLI (Production-Linked Incentive) fiscal incentives will expire around the time of operation. Therefore, Apple and Tata Group may seek new subsidies from the government for the production of the new iPhones.

Apple has been actively expanding in India, and the new iPhone assembly plant is a crucial strategy for both companies. For Apple, it serves to diversify the supply chain risk by gradually shifting the assembly of iPhones from China to India. Meanwhile, Tata Group aims to expand its traditional business scope.

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(Photo credit: Apple)

Please note that this article cites information from Bloomberg and TechNews.


[News] Global Semiconductor Giants Eyeing India, Anticipating Three New Fabs Valued at USD 8-12 Billion

India could see at least three more semiconductor fabrication units coming up in the next few months with cumulative investments to the tune of USD 8-12 billion, Union Minister for Electronics and Information Technology Ashwini Vaishnaw said on Tuesday.

India is working hard to get big semiconductor companies to build chip plants in the country with its $10 billion semiconductor program. Global semiconductor giants are considering making factories in India driven by the need to diversify supply chains beyond China and the big demand for tech talents in India.

According to Deccan Herald’s report. At the unveiling of AMD’s global design center in Bengaluru on November 28th, Ashwini Vaishnaw, Union Cabinet Minister for Railways, Telecommunications, Electronics and Information Technology of India, briefed journalists on ongoing negotiations with several local governments to determine precise locations in the following months.

AMD’s global design center plans to host around 3,000 AMD engineers in the coming years, focused on the design and development of semiconductor technology including 3D stacking, artificial intelligence, machine learning, and more. Vaishnaw pointed out that AMD setting up its biggest design center is strong evidence of how much global companies trust India. Besides, Vaishnaw highlighted the achievement of Micron’s semiconductor plant project, which was revealed in June and started construction in September. He said the success of Micron’s initial facility in India has boosted confidence globally.

Apart from global giants’ investment in India, the minister also told about the Semiconductor Lab (SCL) progress in Mohali, mentioned significant headway in the Expression of Interest (EoI) process. He anticipates finalizing matters within the next 5-6 months. The lab is planned to serve as both a research and semi-commercial facility.

Empowering India’s Semiconductor Dominance

The Indian government asserts that a comprehensive microprocessor chip manufacturing initiative is on the horizon in the country. Anil Agarwal, Chairman of Vedanta, anticipates the launch of “Vedanta chips made in India” by 2025, reported by icbank on weixin.

The government envisions establishing a “semiconductor city” in Dholera, Gujarat, covering an area equivalent to Singapore, with Prime Minister Modi expressing confidence in attracting both domestic and international giants to set up manufacturing plants despite the remote location.

The tech hub in Bangalore has played a pivotal role in India’s ascent as a global participant in the semiconductor network, primarily through chip design. Over the past two years, substantial government subsidies have transformed India into a hub for electronic product manufacturing.

India’s Challenges abound in the Actual Chips Manufacture

Despite initiatives like the “production-linked incentive measures” encouraging mobile assembly in India since 2020, chip manufacturing remains a formidable task.

Presently, nearly all cutting-edge chips are produced in Taiwan, with China’s chip investments surpassing those of India. Vedanta Group’s Agarwal plans to kickstart chip manufacturing within two and a half years, extending invitations to global chip manufacturing experts.

While today’s cutting-edge chips are predominantly manufactured in Taiwan, TSMC has even established a fab in Arizona with the assistance of the U.S. “Chip Act.”

India lacks a historical presence in chip manufacturing and faces a shortage of highly skilled engineers and equipment. Nevertheless, the government aims to achieve what companies like TSMC took decades to accomplish through substantial spending and capital investment promotion. However, China’s significant investments in domestic chip manufacturers, following the U.S. ban tightening China’s semiconductor development last October, far exceed India’s investments in local companies.

With the goal of establishing India’s inaugural semiconductor foundry, Mr. Agarwal of Vedanta Group aims to commence chip manufacturing within two and a half years, extending invitations to international talents like David Reed and Texas Instruments.

Agarwal aspires to attract around 300 foreign experts from East Asia and Europe to Gujarat. The manufacturing of microchips also necessitates a significant amount of customized infrastructure, with Vrishno, the responsible official, indicating that India’s largest chemical plant near Dholera can produce the specialized gases and liquids required for any chip factory’s operation.
(Image: AMD India)

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