As Apple shifts from China, experts worry India will struggle with iPhone production due to supply chain issues, labor woes, a lack of automation, and more
The tech giant increasingly finds itself beholden to America's biggest geopolitical rival. But is diversification even possible?
Financial TimesPatrick McGee
Context & Ripple Effects
Apple has been trying to de-risk its iPhone assembly line for years: a 2020 investigation into its early attempts to build an Indian device supply chain documented how hard it was to replicate China's ecosystem, and by late 2022 the company was pressing suppliers in China, Vietnam, and India to plan assembly actively as part of a deliberate push to reduce its dependence on Foxconn.
The new reporting lands on a track record that keeps disappointing: sources described [[a:835795|India's slow expansion, dragged by logistics, tariffs, infrastructure gaps, and a lack of urgency among suppliers and officials]], while Apple's latest supplier list showed Chinese suppliers actually grew from 48 to 52 in 2023. Experts now argue the bottlenecks are structural — supply chains, labor, and thin automation — not just teething problems.
First-order effects
Apple's diversification timeline slips further: with Indian output constrained by labor disputes and low automation, the company remains more exposed to China than its stated strategy implies, as its own supplier list confirms.
Foxconn's position is paradoxically reinforced — its struggles manufacturing the iPhone 15 in India show that even its most willing partner cannot yet absorb volume at Chinese speed, keeping Apple reliant on the very concentration it wants to escape.
Second-order effects
Component suppliers have little incentive to move: with final assembly in India still small, the parts ecosystem stays anchored in China, which is why the supplier count moved up rather than down even as Apple talked diversification.
Vietnam and other candidate hubs gain negotiating leverage, since Apple's stated plan to spread assembly across geographies makes every alternative location a bidding partner against India's tariff and infrastructure friction.
Third-order effects
If the pattern holds, supply-chain geography proves stickier than geopolitical pressure: China's simultaneous moves to fund domestic hardware startups and mandate domestically made chipmaking equipment suggest Beijing is consolidating its manufacturing base even as Washington-aligned buyers try to leave it.
For multinationals generally, 'China plus one' may settle into 'China plus a sliver' — token capacity in India and Vietnam for political cover, with real production depth remaining in China for years.
The trend: Geopolitically driven supply-chain diversification is running slower than the decoupling rhetoric, with China's manufacturing gravity deepening even as Apple and its peers redirect final assembly.
“How much profit will Apple suck out of its own supply chain as it moves deeper into making key components for its products?” https://www.ft.com/... https://twitter.com/...
“Apple is facing political, strategic and investor pressure to dramatically cut its manufacturing reliance on China. The threat of tariffs loomed large during the Trump admin; Biden has only hardened Washington's stance against Beijing.” @PatrickMcGee_ https://www.ft.com/... http…
Very nuanced article which most people in India will not like or dismiss. We believe in our own “exaggerated opinion about ourselves” which crosses border of “self confidence” & almost become “delusional”. Even countering that is stressful 4 another person https://www.ft.com/...
Perceptive analysis by @PatrickMcGee_ on why Apple just can't quit #China. “Apple's reliance on the country for its annual cadence of product refreshes is now arguably its biggest vulnerability.” https://www.ft.com/... https://twitter.com/...
“..virtually all of Apple's hardware is made in China. The company directly employs only 14,000 people in the country, but it monitors the weekly hours of 1.5mn workers in its global supply chain, the vast majority in China.”🇨🇳🇺🇸 https://www.ft.com/...
Huge move for Apple & India's electronics manufacturing. Luxshare,Sunny Optical+dozen Chinese component makers hv received approvals to make/expand in India even as Indo-China hostilities continue w/ @sankalp_sp @VHeiskanen via @technology @business https://www.bloomberg.com/...
A huge move for Apple and India's electronics manufacturing and component supply chain. Luxshare, Sunny Optical are among 14 Chinese Apple suppliers cleared by India govt even as India-China hostilities continue w/ @sankalp_sp @villeheiskanen via @technology @business https://twi…
More than a dozen of Apple Inc. (AAPL)'s Chinese suppliers are receiving initial clearance by India to expand in the country, helping the tech giant's efforts to diversify its assembly network beyond China. https://www.bloomberg.com/... #MakeInIndia #indianeconomy #NewIndia
This is big: more than a dozen of Apple's suppliers in China have won approval to expand in India Exclusive by @SarithaRai https://www.bloomberg.com/...