The Apple Of India’s Eye

The Apple Of India’s Eye
Daniel Johnston

8 months ago2 mins

What’s Going On Here?

Reports out Monday showed India's set to become very important for Apple.

What Does This Mean?

While Apple isn’t dishing out results until next month, the tech giant already hinted at a possible revenue dip last quarter, as global economies and tech demand shrink. But while some areas sour, India could be poised to keep Apple sweet. That’s down to the rapidly growing middle class, in a country where Apple products have barely made a dent among the 1.4 billion population. See, so far, budget-friendly local brands have stolen the show, and only 4% of the nearly 700 million smartphone users in India sport Apple devices. But things are changing: the firm snatched the top spot for sales of devices over $365 last year, and reports out on Monday suggest that sales in India hit a new high last financial year. If they’re right, then it’s no surprise Apple’s opening its first stores in the country this week.

Why Should I Care?

Zooming in: Upsetting China’s apple cart.

Winning over Indian customers could simplify Apple’s logistics, especially now the company’s ramping up Indian production lines in a bid to ease reliance on China. Reports out last week showed Apple assembled more than $7 billion worth of iPhones in India last fiscal year – tripling production from the year before. That amounts to around 7% of all iPhones, a leap from 1% two years ago. Plus, with wages over 50% lower than China’s, this move could fatten Apple’s profit margins too.

The bigger picture: Apples to oranges.

Apple’s Indian shift dovetails with the government’s plan to rival China as the world’s factory, and the move could entice other Western firms to follow suit. But while the country offers perks – like an ample workforce, a fast-growing economy, and incentives for manufacturers – there’s still a ways to go. Crucially, India’s infrastructure (think roads and ports) still lags well behind China’s, which could be a dealbreaker for many.



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