The company has signed an agreement with Karnataka state government to acquire 300 acres of land at IT Investment Region, at Devanahalli, Bengaluru
Bengaluru, New Delhi, NFAPost: Apple Inc. partner Foxconn Technology Group plans to invest about $700 million on a new plant located in Bengaluru. As part of the investment, the company signed an agreement with the Karnataka government to acquire 300-acre land.
According to Arvian Research, Foxconn Technology Group’s decision is viewed to ramp up local production. This move is an effort to shift manufacturing away from China as Washington-Beijing tensions grow.
The Taiwanese company, also known for its flagship unit Hon Hai Precision Industry Co., plans to build the plant to make iPhone parts on a 300-acre site close to the airport at Doddaballapura & Devanahalli taluks, near Bengaluru.
A team of senior executives from Foxconn, led by Hon Hai Chief Executive Officer and Chairman Young Liu along with 16 senior leaders were in Bengaluru
The factory may also assemble Apple’s handsets, some of the people said, and Foxconn may also use the site to produce some parts for its nascent electric vehicle business.
The investment is one of Foxconn’s biggest single outlays to date in India and underscores how China’s at risk of losing its status as the world’s largest producer of consumer electronics.
Apple and other US brands are leaning on their Chinese-based suppliers to explore alternative locations such as India and Vietnam. It’s a rethink of the global supply chain that’s accelerated during the pandemic and the war in Ukraine and could reshape the way global electronics are made.
The new production site in India is expected to create about 100,000 jobs, states the agreement issued by Foxconn and The Karnataka government. The company’s sprawling iPhone assembly complex in the Chinese city of Zhengzhou employs some 200,000 at the moment, although that number surges during peak production season.
Output at the Zhengzhou plant plunged ahead of the year-end holidays due to Covid-related disruptions, spurring Apple to re-examine its China-reliant supply chain. Foxconn’s decision is the latest move that suggests suppliers may move capacity out of China far faster than expected.
The plans could still change as Foxconn is in the process of finalizing investment and project details, the people said. It’s also unclear if the plant represents new capacity, or production that Foxconn is shifting from other sites such as its Chinese facilities.
Hon Hai, the parent company of Foxconn, Chairman Young Liu met Prime Minister Narendra Modi this week. On Friday, Hon Hai Chairman Young Liu met Karnataka Chief Minister Basavaraj Bommai and signed the agreement to acquire land in the state.
According to Arvian Research Foxconn’s decision would be a coup for Modi’s government, which sees an opportunity to close India’s tech gap with China as Western investors and corporations sour on Beijing’s crackdowns on the private sector.
India has offered financial incentives to Apple suppliers such as Foxconn, which began making the latest generation of iPhones at a site in Tamil Nadu last year.
Earlier, Karnataka IT/BT Minister C N Ashwath Narayanan minister welcomed the delegation which included 17 senior officials of the company on their arrival at the Bengaluru International airport.
During the meeting, Minister apprised the delegation of the industrial ecosystem of the state. He also stated about the quality of IT & Technical education which is being provided in the state, the push given to skill development, the availability of trained human resources and cooperation extended by the industry.
Minister also informed the delegation about the reforms introduced in ITI, Polytechnic and Engineering courses and how the curriculum had been revamped to suit the Global industry demand.
He added, that about 1.5 lakh engineering graduates are coming out every year from 270 engineering colleges in the state. The GTTCs and KGTTIs are playing a major role in imparting required technical skills to the students, he claimed.
The delegation also had a lunch meeting led by Karnataka Industries Minister Murugesh R. Nirani. Dr E V Ramana Reddy, ACS, Department of IT/BT, S Selva Kumar, Principal Secretary, and Gunjan Krishna, Commissioner, Department of Industries were present at the meeting.
The team then had a meeting with Karnataka Chief Secretary Vandita Sharma. The visit of Foxconn officials culminated with a dinner hosted by Karnataka Chief Minister Basavaraj Bommai and signed the agreement with the visiting delegation.
Concluding his visit to the state of Karnataka, Hon Hai Technology Group (Foxconn) Chairman and CEO Young Liu said India is a country with a large population.
“My trip this week supported Foxconn’s efforts to deepen partnerships, meet old friends and make new ones, and seek cooperation in new areas such as semiconductor development and electric vehicles. On the basis to share, collaborate and thrive together, Foxconn will continue to communicate with local governments to seek the most beneficial development opportunities for the company and all stakeholders,” said Hon Hai Technology Group (Foxconn) Chairman and CEO Young Liu.
Smaller rivals Wistron Corp. and Pegatron Corp. have also ramped up in India, while suppliers such as Jabil Inc. have begun making components for AirPods locally.
Foxconn is the world’s largest electronics manufacturer, with total revenue exceeding NT$ 6 trillion in 2022. As of last year, it ranks 20th in the Fortune Global 500.
Foxconn, which owns over 54,000 parents has R & D centres and manufacturing units in many countries including China, India, Japan, Vietnam, Malaysia, the Czech Republic and the USA. Foxconn has 173 campuses and offices in 24 countries/ regions around the world.
The primary product segments for the company include Smart Consumer Electronics (Smartphones, TVs, Game Consoles, etc.), Cloud and Networking Products (servers, communication networks, etc.), Computing Products (computers, tablets, etc.), and Components and Others (connectors, mechanical parts, services, etc.)
