Taiwan's tech giant Foxconn, responsible for manufacturing Apple iPhones in India, has faced a major setback as heavy rain and a cyclone forced the cancellation of its first shift at the Chennai facility on Tuesday. Sources close to the matter
Cyclone Michaung hit the southern India coast on Tuesday afternoon after torrential rains sent tall waves crashing into coastal towns. The southern Indian city of Chennai, where Foxconn's plant is situated, grappled with torrential downpours that led to flooding in various parts of the metropolis. Witness accounts reported cars being swept away and knee-deep water inundating several areas, causing power outages and disruptions reminiscent of the devastating floods in December 2015 that claimed hundreds of lives.
The adverse weather conditions prompted Foxconn and Pegatron to suspend iPhone production at their factories near Chennai. The situation further escalated as Chennai's airport, a pivotal transport hub, ceased operations for the day due to the severe weather conditions.
Government directives mandated the closure of schools, colleges, offices, and banks in multiple districts of Tamil Nadu, including Chennai, for Monday and Tuesday, highlighting the severity of the weather situation.
Apple's strategic shift towards Indian production, initiated in 2020, aimed to narrow the gap between Chinese and Indian manufacturing timelines. While the production lag once spanned up to nine months, it has significantly reduced, with India now contributing to approximately 7 percent of iPhone production. Apple's ambitious goal aims to elevate this figure to 25 percent by 2025, despite potential logistics challenges, as per reports from Bloomberg.
For Apple, bridging the manufacturing gap between its Chinese and Indian facilities, both predominantly operated by Foxconn, remains crucial. This strategy serves as a buffer against geopolitical tensions and local labour disputes, ensuring a consistent supply chain. Moreover, local production enables Apple to navigate tariff barriers in the burgeoning Indian market, aligning with the government's Make in India initiative.