Apple broadens its supply chain horizon, forging partnerships with companies in India, Taiwan, South Korea, and Japan for essential components
In its search for alternative suppliers, Apple is exploring options in India, Japan, and South Korea to secure vital components for its contract manufacturers in India, as per a report by the Economic Times. This initiative follows delays in government approvals for imports from current Chinese suppliers, who provide batteries, camera lenses, chargers, and other crucial equipment for manufacturing iPhones and iPads in India.
During January, 17 Chinese companies, that supply components for Apple devices, sought government clearance to establish manufacturing facilities in India.
Fourteen companies received initial approval, However, applications from four of these companies face indefinite delays, and six have communicated to the government that they are no longer interested in manufacturing in India. The current status of the remaining four companies is uncertain as of now.
“The approvals (in January) were only initial approvals. Because most of these companies have Chinese origin, national security is also an issue. Those approvals have to be carefully given. Issues of environmental clearances, which are a state subject, are given by expert committees,” as explained by a senior government official.
Among the 14 companies are Sunny Optical Technology Group, a manufacturer of camera lens equipment, Han's Laser Technology Industry Group, Luxshare-ICT, the producer of AirPods, and ON Semiconductor Shenzhen China, a capacitor chipmaker.
Another government official clarified that none of the companies' applications have been rejected, emphasizing that all approvals are granted after careful consideration of various factors. Meanwhile, as imports face delays due to pending approvals at both central and state levels, Apple is actively seeking suppliers capable of establishing 'just-in-time' supply chains in India to accelerate local production, as per the report.
Industry experts suggest that due to the current tensions along the India-China border, immediate government approvals for Apple's Chinese component suppliers are unlikely. Eventually, the company initiated preliminary discussions with companies in India, Taiwan, Japan, and South Korea for essential components like batteries, chargers, casing units, cables, and more.
Apple has become more assertive in expanding manufacturing in India to diversify its supply chain beyond China.