'Bye China': Apple Shifting Substantial iPhone Production To India Over 3 Years

Apple Inc AAPL may start manufacturing one out of four iPhones in India by 2025, J.P.Morgan analysts said, as it strived to migrate some production away from China amid mounting geopolitical tensions and strict COVID-19 lockdowns in the country.

J.P. Morgan had an Overweight and $200 price target on Apple. It expects Apple to move 5% of iPhone 14 production from late 2022 to India, the second-biggest smartphone market after China, Reuters reports.

J.P.Morgan expects 25% of all Apple products, including Mac, iPad, Apple Watch, and AirPods, to be manufactured outside China by 2025 from 5% currently.

"Taiwanese vendors such as Hon Hai and Pegatron play a key role in the relocation to India. In the medium to long term, we also expect Apple to qualify local India manufacturing suppliers," the report quoted J.P.Morgan analysts.

Apple aims to manufacture the iPhone 14 in India two months after the product's initial release to cut the lag in production of the new iPhone from the typical six to nine months for previous launches.

India has significantly improved the difference in terms of manufacturing the iPhones with China, and the countries will manufacture the "next iPhone 15 simultaneously," as per an analyst.

Indian conglomerate Tata Group is reportedly in talks with Taiwan's Wistron Corporation to establish an electronics manufacturing joint venture in India to assemble iPhones there.

BofA's tracking of iPhone ship dates indicated extended ship dates for the iPhone 14 Pro models versus last year's pre-order cycle. 

Among regions, ship dates are most elongated in China, where it kept the iPhone prices intact, expecting the growth to offset the ASP pressure from price and FX.

Price Action: AAPL shares traded higher by 0.04% at $156.97 on the last check Wednesday.

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