Apple told component suppliers to source iPhone 16 batteries from India, report says

Apple has notified its component suppliers about its preference to acquire batteries for the upcoming iPhone 16 from Indian factories, as per the report by the Financial Times on Wednesday. This decision is in line with the tech giant's strategy to broaden its supply chain and enhance reliance on manufacturing capabilities in India and a push to move away from China. Business Today was unable to independently verify this information.

According to the report, battery manufacturers such as China's Desay have been encouraged to establish new factories in India. Moreover, Simplo Technology, a Taiwanese battery supplier for Apple, has been urged to expand its production capacity in India to meet upcoming orders.

Union minister Rajeev Chandrasekhar announced on Monday that TDK Corp, a Japanese electronic parts maker, will be producing lithium-ion battery cells for Apple iPhones in India. “Another big win for PM @narendramodi ji’s visionary PLI scheme in shifting the mobile manufacturing ecosystem to India. TDK, a leading supplier of cells to Apple, is setting up a 180-acre facility in Manesar, Haryana to build cells for batteries which will be used in the #MadeInIndia iPhones," he wrote on micro-blogging platform X (formerly known as Twitter).

Meanwhile, Apple has informed the government that its local production goals might suffer if the nation aligns with the European Union's directive mandating universal charging ports for existing iPhones. A government document obtained by Reuters indicates Apple's efforts to seek an exemption or delay. The plea from Apple coincides with the government's push to enforce a standard necessitating USB-C charging ports on smartphones, mirroring a similar initiative in progress within the EU.

Discussions between the government and manufacturers have been ongoing regarding the implementation of this requirement by June 2025. While most manufacturers, including Samsung, have agreed to comply, Apple has yet to endorse the plan.

The EU's charging port regulations come into force in December 2024, with India aiming for a similar enforcement by June 2025. According to the Reuters report, during a closed-door meeting chaired by the IT ministry on November 28, Apple urged officials to exempt existing iPhone models from the regulation, citing potential difficulties in meeting production targets set under the country's production-linked incentive (PLI) scheme.

The PLI scheme offers fiscal incentives to electronic manufacturers in India, encouraging both new investments and annual increases in phone sales. Apple suppliers, such as Foxconn, have extensively utilized this program to bolster iPhone manufacturing in the country.

Apple's regulatory and product compliance executives conveyed that implementing the regulation on earlier phone models would impede their ability to meet PLI targets. However, Apple did not specify the specific production impact during the meeting, and the IT ministry intends to review the request before making a decision.

The imposition of the universal charger rule could pose a significant challenge for Apple, which has experienced substantial sales growth in India in recent years. With India emerging as Apple's next focal market after China, prominent Apple analyst Ming-Chi Kuo estimates that 12-14 per cent of iPhone production in 2023 will originate from India. He anticipates this figure could escalate to as much as 25 per cent in the following year.

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