Apple Inc. (NASDAQ:AAPL) will start building iPhones in India within weeks, according to a report from Wall Street Journal (via New York Post).
Citing local government officials, the Journal reported that Apple and its Taiwanese contract manufacturer Wistron will likely to begin manufacturing iPhone 6 and 6S models in India within the next four to six weeks.
“Almost all preparations have been done for launching Apple’s first phase project in Bangalore through Wistron,” the official told the Journal.
Apple declined to comment on the story when the tech giant was contacted by the paper. However, an Apple spokeswoman told the publication that:
“We’ve been working hard to develop our operations in India. We appreciate the constructive and open dialogue we’ve had with the government about further expanding our local operations.”
Apple Wants India to Replace China
Apple is worried about its stalled growth in the United States and China.
The tech giant wants India to replace China, which is still a very difficult market to crack for foreign companies.
Last year, Apple CEO Tim Cook visited India in a bid to learn about the Indian smartphones market, which is being dominated by Android.
Apple’s smartphones are too expensive for most customers in India. Analysts believe that the company will cheaper iPhones and large retail presence through stores or online channels for winning in India.
According to an analyst, the iPhone maker could reduce iPhone prices in India by at least $100 by side-stepping local import tariffs with a local factory.
Analysts at Mizuho Securities believe that India is unlikely to compensate for Apple’s slowing sales in China, according to report from Barrons.
“Based on our extensive analysis of opportunities presented by India and its comparison with China, India is unlikely to help offset the slowdown in China due to lower wages, strong incumbents at very attractive price points, lack of carrier support and the political environment. Even if it gets full access to the Indian market, the region will likely contribute $9-10 billion in revenue (4-5% of total sales), which might not be enough to move the needle. Over the next couple of years, India is unlikely to contribute more than 2-3% of total sales,” the firm’s analysts said in a report last year.
Apple Inc. (NASDAQ:AAPL) is likely to face a stiff competition from Samsung and other Chinese mobile makers, which sell cheaper Android phones.
During the first quarter of 2016, billionaire investor Carl Icahn sold his entire stake in Apple, citing concerns about the iPhone maker’s growth in China.
However, Warren Buffett has more than doubled his holdings in Apple though his firm Berkshire Hathaway. Buffett owns around $17 billion worth of the company’s stock, according to a report from CNBC.