Tata Electronics has secured a majority stake in Pegatron’s iPhone manufacturing plant in Tamil Nadu, marking a major step in expanding its role in Apple’s production ecosystem. The strategic move, announced internally last week, sees Tata acquiring 60% of the Taiwanese contract manufacturer’s only iPhone facility in India. Pegatron will retain a 40% stake, continuing to provide technical support. This partnership strengthens Tata’s position as a key supplier to Apple in India, challenging Foxconn, the other major contract manufacturer for Apple in the country.
Strengthening Apple’s Diversified Supply Chain
This acquisition plays a crucial role in Apple’s ongoing strategy to reduce its dependence on China, especially in light of geopolitical tensions between Beijing and Washington. By collaborating with Tata, one of India’s largest conglomerates, Apple is enhancing its presence in India, which is expected to account for 20-25% of global iPhone shipments in 2023—up from 12-14% in 2022.
Expanding Manufacturing Footprint in India
Located in Chennai, the Pegatron plant employs around 10,000 workers and has an annual production capacity of five million iPhones. This plant now becomes Tata’s third iPhone manufacturing site in India, complementing its existing plants in Karnataka and Hosur, Tamil Nadu. Tata’s Karnataka facility was acquired from Taiwan’s Wistron last year, and the Hosur facility also houses an iPhone component manufacturing unit.
The acquisition is still pending approval from India’s Competition Commission (CCI), but the deal has already been communicated to employees at the Chennai plant. Once finalized, Tata’s iPhone manufacturing capabilities will scale up significantly, solidifying its growing partnership with Apple.
Implications for India’s Electronics Manufacturing Ambitions
This joint venture not only signals a major shift in Apple’s global supply chain strategy but also highlights India’s rising importance as a hub for electronics manufacturing. As Apple increases its production share in India, the country is well-positioned to become a key player in global electronics production. Tata’s expanding role in the sector underscores the company’s growing influence in the high-tech manufacturing world.
With three iPhone factories under its belt, Tata is set to capitalise on India’s emerging role in the global electronics supply chain, further cementing its position as a dominant force in the industry.
