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Exclusive, Apple supplier Foxconn plans to quadruple its workforce in India

Exclusive, Apple supplier Foxconn plans to quadruple its workforce in India

By Sudarshan Varadan and Yimo Lee

NEW DELHI/TAIBIE (Reuters) – Apple Inc.’s Foxconn plans to quadruple its workforce at its iPhone plant in India over two years, two government officials familiar with the matter said, citing a production adjustment as it faces disruptions in China.

Foxconn has made headlines in recent weeks, with strict virus restrictions at its plant in Zhengzhou, the world’s largest iPhone factory, disrupting production and raising concerns about the impact of China’s virus policy on global supply chains.

The turmoil prompted Apple to lower its forecast for shipments of premium iPhone 14 models this week, lowering its sales forecast for the busy year-end holiday season.

The sources, who asked not to be named because the discussions are private, said Taiwan-based Foxconn now plans to increase the workforce at its plant in southern India to 70,000 by adding an additional 53,000 workers over the next two years.

While the size of the plant in the southern Indian state of Tamil Nadu pales in comparison to Foxconn’s plant in Zhengzhou, which employs 200,000 workers, it is central to Apple’s efforts to shift production away from China.

Foxconn, officially called Hon Hai Precision Industry Co Ltd, opened its plant in India in 2019 and is ramping up production. It started producing iPhone 14 this year.

Foxconn’s interest in expanding the facility is known, but the planned expansion scale and timelines have not been previously reported.

Foxconn and Apple declined to comment.

Foxconn Chairman Liu Yongwei said in an earnings call Thursday that the company will adjust its production capacity and production, so there will be no impact from further potential disruptions to supplies for the Christmas holidays and Lunar New Year.

A senior government source said Foxconn has informed officials in Tamil Nadu of its plans to speed up recruitment efforts at the Indian factory due to the unrest in China.

In addition to iPhones, the factory also manufactures products for other global technology companies, but the new hiring push is mainly driven by the need to meet the growing demand for iPhones, the person added.

A person in Taiwan familiar with the matter said that Foxconn is expanding its operations in India to increase its capacity on base models and meet Indian demand.

“We are gradually increasing our production volume there,” the person said, declining to give details of India’s recruitment plans.

India’s second government source, a senior official in the Tamil Nadu state administration, said the state government is working with Foxconn to “finish” the expansion.

On October 27, the state’s investment promotion arm tweeted that senior government officials had traveled to Taiwan and met Liu. They “discussed at length Foxconn’s plans for new projects and investments” and offered government support.

The chief government official said the state is in discussions with suppliers to address issues such as housing facilities for workers as it seeks expansion.

Last year, Foxconn’s Tamil Nadu factory was at the center of a mass food poisoning incident that sparked employee protests and shed light on the living conditions of workers in hostels near the factory.

The two government sources added that officials in Tamil Nadu, a hub for manufacturing electronics and cars, were also pushing Apple’s suppliers to expand into components for iPhones beyond mere assembly.

Currently, iPhones are assembled in India by at least three global Apple suppliers: Foxconn and Pegatron in Tamil Nadu; Westrun is in nearby Karnataka.

JP Morgan analysts estimated in September that Apple could manufacture one in four iPhones in India by 2025, and 25% of all Apple products, including Mac, iPad, Apple Watch and AirPods, will be manufactured outside China by 2025. 5% currently.

reporting



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