Apple’s key assembly partner Foxconn Technology Group has recalled nearly 300 Chinese engineers from one of its factories in India, creating another challenge in the company’s efforts to expand its production base in the country.
The engineers were withdrawn from Yuzhan Technology, a Foxconn component unit located in southern Tamil Nadu. This is the second such recall in just a few months. To fill the gap, Foxconn has started bringing in Taiwanese engineers to continue operations, according to people familiar with the matter who did not wish to be named.
Earlier this year, officials in Beijing verbally encouraged regulatory bodies and local governments to restrict technology transfers and equipment exports to India and Southeast Asia. The intention appeared to be to discourage companies from moving their manufacturing out of China. While it remains unclear why the Foxconn workers were specifically recalled, the move highlights the continued influence Chinese technicians and supply chains have over the production of advanced products such as the iPhone.
Reports earlier suggested that Yuzhan’s Chinese employees were leaving. More recently, another report noted that Foxconn had asked hundreds of Chinese engineers and technicians to return home from its iPhone factories in India.
The Yuzhan factory currently makes enclosures, or metal cases, and display modules for older iPhone models. It is not yet involved in the production of the latest iPhone 17 line. The factory only began operations a few months ago, and Apple still imports most of its display units, according to sources.
For now, Apple may increase its reliance on imported displays and turn to other local suppliers for enclosures. However, the exit of experienced Chinese staff could slow down Apple’s push to localise its supply chain more deeply in India.
Apple has deliberately chosen to partner with Indian suppliers and has avoided bringing in major Chinese partners to its Indian operations. Among its most notable collaborations is with the electronics manufacturing arm of the Tata Group, currently the only Indian company assembling iPhones. While Chinese suppliers have been producing iPhones for almost twenty years, Indian suppliers are still navigating early challenges in the process.
A potential improvement in the strained relationship between India and China could benefit Apple as well as other automakers and local industries. China has promised India supplies of rare earth minerals and tunnel-boring machines, although talks on these matters have not yet shown results.
Meanwhile, Apple is preparing for a significant milestone. The company is set to produce all four models of the upcoming iPhone 17 in India ahead of their launch next month. This marks the first time that every new model, including the pro-level versions, will be shipped from India right from the start.
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