Pegatron mulls expansion of Apple factory near Chennai 🇮🇳 🤝 🇹🇼

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Employee buses enter the Pegatron facility near Chennai, India, March 7, 2023. Credit: Reuters Photo

Taiwan’s Pegatron Corporation, a major supplier to Apple Inc, is mulling expanding its massive manufacturing unit near here, as the Cupertino-based technology giant plans to shift a major portion of its operations out of China to countries like India.
The expansion plan, which is expected to happen in the near future, was the topic of discussions during a meeting that Pegatron Chairperson T H Tung had with Chief Minister M K Stalin at the Secretariat here.

The meeting comes within a week of officials from Foxconn Industrial Internet (Fii), a subsidiary of another key Apple supplier Foxconn, meeting Stalin and promising fresh investments in the state.

"Pegatron is planning to invest more in India. We have been talking to them yo ensure that they further invest in Tamil Nadu by expanding their Chennai facility. Today’s meeting has set the tone for further talks between the two sides. We can expect forward movement in the coming months,” a person aware of the developments told DH.

“We are hopeful that Pegatron will come up with Phase-2 of its project,” the person added. The meeting also assumes significance in the wake of the state government planning to host the third edition of Global Investors’ Meet (GIM) in January 2024.

The person quoted above added that two officials from top Taiwanese companies courting the Tamil Nadu government in just a few days’ gap augurs well for the state’s investment climate. The meetings come two months after technology giant CISCO announced plans to set up its first India unit in Chennai through a contract manufacturer.

Pegatron entered India in 2021 under the production linked incentive (PLI) scheme by setting up its unit at Mahindra World City in Singaperumalkovil, 40 km from here with an investment of Rs 1,100 crore.

The factory, which commenced operations in September 2022, now assembles flagship iPhone 13 and iPhone 14 much like its Taiwanese counterpart Foxconn, which boasts of a massive manufacturing facility in Sriperumbudur. At the inauguration ceremony, Stalin had expressed the hope that Pegatron will expand its facility by investing more.

The plant began assembling iPhone 14 within a few months of launching operations. Apple, which had last year had struggled to roll out iPhones from Foxconn’s massive manufacturing unit in China’s Zhengzhou, has been pushing its suppliers to launch or ramp up production in countries like India.

Tamil Nadu is home to several Apple suppliers like Foxconn, Pegatron, home-grown Tata Electronics Private Limited (TEPL), and Salcomp, which supplies chargers.

The development also comes close on the heels of the state emerging as the no.1 in the country in electronics exports at USD 5.37 billion in 2023 fiscal, moving from the fourth position in fiscal 2022. Ramping up and launch of production by Foxconn, Pegatron, and home-grown Tata Electronics Private Limited (TEPL) helped the state pip Uttar Pradesh, Karnataka, and Maharashtra, officials said.

The state, which is already home to top 16 electronics manufacturers, including Nokia, Samsung, Flex, Dell, Motorola, Salcomp, HP, and Foxconn, wants the electronics industry to be on par with automobiles that accounts to 37.6 per cent of the country's automobile and auto component exports, apparel (30.8 per cent) and footwear (46.4 per cent).

The state has two exclusive Special Economic Zones (SEZs) for Electronics and Hardware manufacturing in Sriperumbudur, 50 km from here, and in Oragadam, 70 km from here, spread over 800 acres.

Pegatron mulls expansion of Apple factory near Chennai

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