Tata Expands iPhone Production Capacity in India with Pegatron Deal in Tamil Nadu

Tata Electronics is set to acquire a majority stake in Pegatron’s iPhone manufacturing plant in Tamil Nadu, marking a significant expansion of Tata’s role as an Apple supplier. Under the terms of the agreement, Tata will hold a 60% stake in the facility and oversee its day-to-day operations, while Pegatron will retain the remaining 40% and provide technical support.

The agreement, which was internally signed last week, is expected to bolster Tata’s growing position in the global iPhone manufacturing ecosystem.  The Indian conglomerate’s aggressive expansion into Apple’s supply chain is a significant development, even though the economic terms of the agreement have not been disclosed.

This new partnership will occur at a time when Apple is currently in the process of identifying new manufacturing venues outside of China as a result of the ongoing tensions between the United States and China. Tata now has a more tangible opportunity to compete in India, as it has joined Foxconn, the sole other iPhone manufacturer in the country.

The Tamil Nadu plant, which employs approximately 10,000 workers, produces nearly five million iPhones annually. It marks the third iPhone manufacturing facility in India, adding to its already operational iPhone assembly plant in Karnataka, which was previously administered by Wistron and was acquired by Tata last year. Additionally, Tata is engaged in developing an additional iPhone plant in Hosur, Tamil Nadu.

The deal is expected to garner regulatory scrutiny, with Tata and Pegatron planning to seek approval from India’s Competition Commission in the coming days.

India’s role in Apple’s supply chain is growing rapidly, with analysts forecasting that the country will account for 20-25% of total global iPhone shipments this year, up from just 12-14% in 2023. The most recent expansion of Tata as an iPhone manufacturer is indicative of the increasing importance of India in the Apple supply chain, as the tech giant reduces its reliance on Chinese manufacturing.