MUMBAI: India's largest conglomerate, Tata Group, is close to a deal to an agreement to acquire an Apple Inc supplier’s in August, marking the first time a local company would move into iPhone assembly, according to people familiar with the matter.
The takeover of the Wistron Corp. plant in southern Karnataka, potentially worth more than USD 600 million, would cap about a year of negotiations. The facility employs more than 10,000 workers who assemble the latest iPhone 14 model.
People said Wistron to ship worth at least USD 1.8 billion iPhones from the factory in the fiscal year through March 2024 to win state-backed financial incentives. It also plans to triple the factory workforce by next year. Tata is set to honor these commitments as Wistron exits the iPhone business in India.
Spokesmen for Tata, Wistron and Apple declined to comment.
The addition of the Indian iPhone is likely to add momentum to Apple's efforts to diversify its product base outside of China and build up technological manufacturing in the South Asian nation. Wistron exported nearly USD 500 million in iPhones from India in the three months ended June 30, and Apple's other major Taiwanese suppliers Foxconn Technology Group and Pegatron Corp. have also ramped up locally.
India has made progress in domestic manufacturing since Prime Minister Narendra Modi set up government programs with lucrative financial incentives to expand production and employment. Apple has stepped up efforts to diversify away from China in the aftermath of the country's Covid lockdown and rising tensions between Washington and Beijing.
An Indian company making iPhones could be a major boost to Modi's efforts to challenge China's status as a global manufacturer. It may help convince other global electronics brands to consider producing in India to reduce their dependence on China.
The 155-year-old Tata Group sells everything from salt to tech services. In recent years, the group has sought to venture into e-production and e-commerce, both of which are relatively new territories for the Tata family.
It already makes the iPhone's chassis, or the metal backbone of the device, at its factory sprawling across hundreds of acres of land in Tamil Nadu. Chairman N Chandrasekaran said Tata is also boosting its chip industry ambitions.
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