Kunpeng Project Foxconn, as a world-renowned electronics foundry giant, has fallen into a new competition since Huawei's Kirin core and mobile phones encountered challenges. As Apple shifted production capacity to Southeast Asia such as India, Foxconn was forced to follow suit. However, the road ahead is full of twists and turns.
Since 2019, Foxconn has actively responded to Apple's production capacity relocation plan and invested in building factories in India, but there is a significant gap between India's market environment and employee quality and that of the mainland. According to the data, India's manufacturing environment still has many problems compared to China, including poor infrastructure and insufficient labor skills. Foxconn's factories have been in a state of frequent shutdowns, and production capacity and yield rates are much lower than expected. According to industry insiders, Foxconn's factory yield rate in India is only 50%, far lower than its level in China.
Despite the difficulties, Gou did not give up his determination to build a factory in India. On the contrary, he continued to invest money, and even announced the transfer of a large amount of production capacity to India, and launched cooperation with local Indian companies in an attempt to gain a foothold in the Indian market. According to public information, Foxconn has invested heavily in the construction of Indian factories since 2022, and it is expected that the number of employees in India will be expanded to 200,000 to meet future production capacity needs.
However, the reality is harsh. Foxconn's efforts did not pay off as expected. According to Apple's latest data, Foxconn's orders for the iPhone 15 series did not increase last year, but were divided into 27% to Luxshare and Pegatron. In addition, India's Tata Group has also increased competition in the foundry field after the acquisition of Wistron Technology's factory, which means that Foxconn's position in the ** chain has gradually been challenged.
At the end of 2023, Apple issued an iron order to Foxconn, requiring it to increase India's production capacity to 20-25%, even if the yield rate is only 50%, this goal must be achieved. However, the return of Huawei and the rise of other manufacturers have left Apple with unprecedented challenges.
In the eyes of explorers, Gou Taiming chose a path of no return and followed Apple desperately to fight in the Indian market. However, he may have overlooked the cruelty of reality. The rise of Luxshare Precision, Pegatron Technology and BYD Electronics has shaken Foxconn's position in the industry, and the myth of Foxconn may be about to be shattered.
So what do you think of Foxconn and Terry Gou's path to India? Do you think Foxconn should continue to expand in the Indian market? Feel free to leave your views in the comment section.