By BrightNewsBeat 
Overview of Apple’s Expansion in India
Apple is taking significant steps to solidify its presence in India, a market recognized as the second-largest smartphone market globally. The tech giant plans to open four new retail stores in major cities: Bengaluru, Pune, Delhi-NCR, and Mumbai. This expansion builds on the company’s previous success with its first two stores, which opened in Mumbai and New Delhi last year.
Commitment to Local Markets
Deirdre O’Brien, Apple’s Senior Vice President of Retail, expressed excitement about the expansion, emphasizing the company’s dedication to engaging with Indian customers. She remarked, “We are thrilled to build our teams as we plan to open more stores in India. We can’t wait for our customers to explore our amazing products and services while engaging with our knowledgeable team members.” However, the company has not yet provided specific timelines for the opening of the new stores.
Local Manufacturing Initiatives
In conjunction with the retail expansion, Apple has also commenced manufacturing its entire iPhone 16 lineup, including the Pro models, in India. This is a pivotal move for Apple as it seeks to reduce its dependence on China for production. The company initiated its manufacturing efforts in India in 2017, starting with the iPhone SE model. The transition to local production aligns with India’s growing significance as a manufacturing hub.
Slower-than-Expected Production Shift
Despite these positive developments, analysts from J.P. Morgan have noted that Apple’s shift to Indian production is progressing more slowly than anticipated. Current estimates suggest that iPhone production in India accounts for only 10-15% of total output. In earlier forecasts, the bank projected that 20-25% of iPhones would be manufactured in India by 2025, but this timeline has now been extended to 2027.
Challenges in Production
The challenges faced by Apple in India include lower assembly margins compared to China. This is attributed to several factors:
- Sub-Optimal Operating Scale: The scale of operations in India is still in its nascent stages, leading to higher costs per unit produced.
- Learning Curve: As Apple continues to establish its manufacturing processes in India, the learning curve associated with new production techniques has impacted efficiency.
- Labor Costs: Although labor costs in India are significantly lower—ranging from 25% to 50% of those in China—the other factors have offset these savings.
Financial Growth in the Indian Market
Despite the challenges, Apple’s business in India is experiencing robust growth. According to Morgan Stanley, the company’s revenue in India surged by 42% year-on-year in 2023, reaching $8.7 billion. Additionally, iPhone shipments grew by 39% year-on-year, totaling 9.2 million units, making India the fifth-largest smartphone market for Apple. Remarkably, India’s iPhone business in 2023 outperformed any individual country in the European Union.
Conclusion
Apple’s strategic initiatives to open new retail stores and manufacture its latest iPhone models in India highlight its commitment to tapping into the immense potential of the Indian smartphone market. As the company continues to navigate the complexities of local production and distribution, it remains poised for significant growth in a country that is rapidly evolving into a key player in the global tech landscape.
