Tata Group is reportedly in talks with one of the three Apple iPhone makers in India to buy their manufacturing facility in Karnataka. A report claims that the deal has been pegged at Rs 4,000 crore- Rs 5,000 crore.
The transaction will help Tata ramp up the manufacturing capabilities of group company Tata Electronics Pvt Ltd (TEPL) in precision engineering.
TEPL is already a components vendor for Apple’s iPhones and plans to also deal with other large manufacturers from Korea and Japan as part of a ‘larger electronics ecosystem’.
Tata Sons holds 100% of TEPL stock, which makes it an owned and operated subsidiary of Tata Sons. It aims to become a large contract maker of handsets and components after group chairman N Chandrasekaran tried to capitalise on the geopolitical backlash against China and attract smartphone companies such as Apple.
Operations shifted to India’s Alternative production base. Tata could also take up a share of Wistron’s manufacturing business beyond smartphone manufacturing as well.
According to media, The Tata Group declined to comment on the queries and emails sent to Wistron did not generate a response.
Wistron, one of the key manufacturers, started making iPhones in India in 2017, after years of efforts by Apple to add manufacturing capabilities in the nation. The Taipei-based firm at present assembles iPhones at its plant in the state of Karnataka in southern India.
Tata Group’s move will allow Apple to reduce its dependency on the Chinese market which is exposed to stricted covid lockdowns and economic uncertainty. Currently, Apple’s biggest supplier Foxconn is facing issues with the production of iPhone 14 and iPhone 14 Pro models at its plant in Zhengzhou. After massive worker unrest, the company is expected to fall behind in achieving shipment targets. Analyst Ming-Chi Kuo has claimed that the shipments could shrink by 15-20 million units due to the worker unrest last week.
