Taiwanese contract manufacturer Foxconn has won an order from Apple Inc to make AirPods, and plans to build a new $200 million factory in the Indian state of Telangana to produce the wireless earphones, according to two people with direct knowledge of the matter. Foxconn, the world’s largest contract electronics maker, which assembles around 70% of all iPhones, will mark the first time they are making AirPods. This move signals Foxconn’s efforts to diversify their production away from China, where the company had experienced significant disruption to the biggest iPhone factory last year due to COVID-19 related restrictions.
This decision to set up production in India was requested by Apple, according to a source. Foxconn is in competition with other Taiwanese suppliers like Wistron Corp and Pegatron Corp to get more orders from Apple – the world’s most valuable company. The subsidiary of Foxconn, Foxconn Interconnect Technology Ltd., aims to initiate construction of the manufacturing plant in Telangana during the next half of 2021, and begin production by the year 2024.
The person with direct knowledge of the matter, who opted to remain anonymous, stated that the decision to go ahead with the project was made to “reinforce engagement” with Apple, hoping that it will yield more orders for their new products. While the actual monetary value of the AirPod order remains undisclosed, the source did mention that other suppliers such as Luxshare Precision Industry and Goertek Inc may be affected by the production plans of Foxconn.
The person also mentioned in the article is the source who requested to remain anonymous due to the fact the matter was not yet made public.
Finally, Foxconn is a Taiwanese multinational electronics contract manufacturing company with its headquarters based in New Taipei City, Taiwan. It is the world’s largest contract electronics manufacturer and the fourth-largest information technology company by revenue, and is taking steps with Apple Inc to diversify their production away from China. Foxconn produces products and services for many prominent tech firms around the world, including Amazon, Apple Inc, Cisco, Google, Dell, Microsoft, and Nintendo.