As iPhone maker Apple looks to increase the production of its smartphones in India, one of its contract manufacturer, Pegatron, may open a second factory in the country.

The Taiwan-based manufacturer of phones has already started production from a unit near Chennai with an investment of ₹1,100 crore. The company had signed a Memorandum of Understanding (MoU) with the Tamil Nadu government in February 2021 in this regard.

“The second unit is being explored to meet Apple’s plans to build a resilient supply chain ecosystem outside of China. But no final decision has been taken yet,” said a source close to the development. While businessline could not ascertain the location of the second plant, Reuters said the second unit could also be set up near Chennai.

Out of China

Apple may make one out of four iPhones in India by 2025, according to a September 2022 report by JP Morgan, as the tech giant moves some production away from China, amid mounting geopolitical tensions and strict Covid-19 lockdowns in the country.

The brokerage expects Apple to move about 5 per cent of iPhone 14 production from late 2022 to India, which is the world’s second-biggest smartphone market after China. It is also estimating about 25 per cent of all Apple products, including Mac, iPad, Apple Watch and AirPods, to be manufactured outside China by 2025 from 5 per cent currently.

In March, Bloomberg had reported that Apple Inc’s other manufacturing partner, Foxconn Technology Group, plans to invest about $700 million on a new plant in India to ramp up local production.

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