Tata Group is on track to finalize a deal to acquire Pegatron Corp.'s iPhone manufacturing operations in India, signaling a potential expansion of Apple's sourcing from Indian suppliers. The move comes as part of Apple's broader strategy to minimize its manufacturing footprint in China and outsource to other regions under the leadership of PM Narendra Modi's government, which is offering incentives to increase production in India.
According to reports, Tata Electronics Ltd. is set to manage Pegatron's operations in India once the acquisition is completed, allowing Tata Group to leverage Pegatron's manufacturing expertise. This decision is in line with Apple's recent efforts to onboard Indian partners for various components of its products, such as the discussions with Titan Company and Murugappa Group for producing sub-components for iPhone camera modules.
The Indian government's initiative to offer production-linked incentives has attracted major Apple suppliers like Foxconn and Pegatron to ramp up their manufacturing operations in India. By diversifying its supply chain and collaborating with Indian partners, Apple aims to mitigate geopolitical risks and reduce its heavy reliance on China for production. Additionally, the drive to localize manufacturing activities is in line with the current global trend of companies seeking to decentralize their supply chains for increased resilience.