This move strenthen Tata group’s position as a key player in Apple’s supply chain, expanding from salt and steel production to high-tech electronics manufacturing.
Taiwan’s Pegatron is one of the leading companies with a contract to manufacture iPhones globally. Noel Tata led, Tata Group has now acquired a significant stake in the Indian unit of this company. This strategic move sets up a joint venture between Tata and Pegatron to manufacture iPhones in India, accelerating the production of iPhones within the country.
Tata Electronics’ Strategic Move
In a major milestone, Tata Electronics has taken a significant step in the iPhone manufacturing industry by acquiring a substantial stake in Pegatron’s Tamil Nadu plant. This deal is expected to boost the production capacity of iPhones in India. However, neither Tata Electronics nor Pegatron have officially commented on the deal yet.
Tata Group Acquires 60% Stake
According to media reports, Tata Electronics is expected to own a 60% stake in this deal. Pegatron, in collaboration with Tata, will continue iPhone production under this joint venture. The deal is estimated to be worth between $150 million to $200 million. This partnership aligns Tata with other Taiwanese firms like Wistron and Pegatron, positioning them to manufacture iPhones in India. Meanwhile, Taiwan’s Foxconn remains a major contract manufacturer for iPhones.
Accelerated iPhone Production in India
Currently, Apple’s contract manufacturers have a production capacity of 40 million iPhones annually, with a monthly output of approximately 30 to 35 million units. This new deal with Tata is expected to speed up iPhone production, particularly aiding Apple in diversifying its supply chain outside of China. Geopolitical tensions have impacted iPhone supply chains, making this expansion in India critical for Apple. With Tata Electronics’ entry, India could potentially meet increasing iPhone demand both domestically and in neighboring regions. Apple has noted a surge in iPhone demand over the past few months.
Benefits from PLI Scheme
The Indian government’s Production Linked Incentive (PLI) scheme for electronics manufacturing is likely to benefit both Tata Group and Pegatron. Following its acquisition of Wistron’s iPhone assembly plant, Tata has become the first Indian company to have a significant foothold in global iPhone manufacturing.
This strategic collaboration not only boosts India’s capabilities in high-end electronics manufacturing but also aligns with Apple’s efforts to reduce its dependence on China by diversifying its production hubs.
Noel Tata was appointed as the chairman of the Tata Trusts on October 11, 2024, after the death of his half-brother Ratan Tata. Natarajan Chandrasekaran is the chairman of Tata Sons, the holding company for the Tata Group.
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