“Pegatron Discusses Transfer of Indian iPhone Factory to Tata: Sources”

In a significant development, Taiwanese electronics giant Pegatron is reportedly in advanced discussions with The Tata Group to transfer control of its sole iPhone manufacturing plant in India to the Indian conglomerate. This move, backed by iPhone creator Apple, marks a strategic shift that could impact Apple’s supply chain diversification efforts.

According to Reuters, Tata is poised to acquire at least a 65% stake in the joint venture that will manage Pegatron’s facility near Chennai, with the remaining stake held by Pegatron itself. The operation will fall under Tata Electronics Unit’s purview and is expected to encompass around 10,000 employees, producing approximately 50 lakh iPhones annually.

This move comes as Pegatron navigates a global restructuring, forfeiting control of an iPhone plant in China to Luxshare last year. The shift towards India aligns with Apple’s broader strategy to reduce dependence on Chinese manufacturing amid geopolitical tensions.

In addition to the Chennai plant, Tata already operates an iPhone assembly facility in Karnataka, acquired from Wistron last year, and is constructing another in Hosur, Tamil Nadu, where Pegatron may also become a partner. Talks between Tata and Pegatron include the potential acquisition of Pegatron’s new Chennai-based factory as well.

The negotiations are anticipated to conclude within six months, with all Pegatron India employees transitioning to the joint venture. This move underscores Tata’s pivotal role in Apple’s expansion plans in India, a market poised to contribute 20-25% of total iPhone shipments this year, up from 12-14% in the previous year.

While the exact reasons for Pegatron’s divestment from its Apple operations remain undisclosed, last year’s China plant transaction was part of Pegatron’s broader strategy to optimize its business.

The outcome of these talks between Tata and Pegatron holds implications not only for the Indian manufacturing landscape but also for Apple’s supply chain dynamics as it continues to diversify beyond its traditional manufacturing hubs.

Sources By Agencies

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