In a statement to the Wall Street Journal, Apple has confirmed that its manufacturing partners in India have started domestic production of iPhone SE. Up to now, Apple produces almost all of its iPhones in China (although some older models have been assembled in Brazil). Presumably, the devices will bear an ‘Assembled in India’ label on the hardware. Apple is pushing hard into India as it looks for new markets to grow iPhone sales.
The report says that the iPhone SE devices are being made in Bangalore and will ship to customers later in May, with the first domestically-produced phones appearing on store shelves next week. Pricing is unknown …
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In the US, the iPhone SE sells in two flavors, a 32 GB and 128 GB model for $399 and $499 respectively. Third-party Indian resellers already undercut that price point, selling iPhone SE around the $320 mark.
Apple was effectively forced into setting up domestic manufacturing in order to launch Indian retail stores, as India laws state that companies wanting a retail presence must source at least 30% of their goods locally.
According to the Wall Street Journal, government officials hope to see the India iPhone SE sell for even less in its home country.
There are obviously some cost savings for Apple to take advantage of by producing domestically and local government reportedly believes Apple could sell its iPhone for as low as $220 (converted to Indian currency). Apple typically does not like to price its devices differently based on region, however, so final pricing is unknown.
However, Apple may be more lenient with its pricing in order to capture marketshare in the region where the average smartphone sells for under $200. One would assume that if the iPhone SE is a sales success, Apple will want to produce its newer devices (like iPhone 7) domestically too.
Meanwhile, the administration continues to pile pressure onto Apple to make more of its products within the United States. Foxconn is said to be exploring a US factory and Apple has launched a $1 billion investment fund for US advanced manufacturing.