A key supplier to Apple Inc has started making parts for AirPods in India, a significant step in the US tech giant’s push to increase production in the country.
Jabil Inc. The Indian unit of Apple has started shipping AirPods enclosures, or plastic bodies, to China and Vietnam, where the wireless earphones are assembled, said people familiar with the matter, asking not to be named to make the move public.
Apple is building production in India to reduce its dependence on China, where US trade sanctions and Covid-related disruptions have made manufacturing more risky. Its India production has so far been limited to the iPhone, making the AirPods the second Apple product to be partially manufactured in the country.
Prime Minister Narendra Modi has made it a national priority to develop India’s manufacturing sector by providing financial incentives and government support for companies’ expansion projects. Apple has played a central role in that effort, producing more iPhones in the country than ever before for the latest generation with partners like Hon Hai Precision Industry Co.
American manufacturing services provider Jabil operates an 858,000-square-foot (80,000 m) facility in Pune, western India, which employs more than 2,500 people, according to its website.
Jabil representatives did not respond to a request for comment. Apple declined to comment.
Apple is the world’s largest manufacturer of so-called true wireless stereo devices, a category that includes wireless earphones and headphones. It sold 23.8 million units in the third quarter for a 31% market share, according to research firm Canalys.
While India is still some time away from getting Apple to fully manufacture AirPods locally, New Delhi has roped in more than a dozen of its Chinese suppliers to ramp up through joint ventures with Indian partners. Initial approval has been given. Luxshare Precision Industry Co Ltd, one of Apple’s Chinese suppliers that makes the AirPods, is one of the companies to receive the approval. In 2020, Luxshare agreed to take over a shuttered Motorola plant in India’s southern Tamil Nadu state, but has yet to begin manufacturing Apple products locally.
Apple’s latest India push comes as the Modi government plans to offer financial incentives for local production of wireless earphones and smartwatches, said one of the people.
Cupertino, California-based Apple has a long way to go in diversifying from China, which makes about 98% of iPhones. Tensions between Washington and Beijing, and a Covid outbreak at a major plant in the country, exposed weaknesses in the company’s supply chain.
Still, the company has made progress with the effort. Partner Hon Hai began making the iPhone 14 in India weeks after the model’s global launch last year, and Apple exported more than $2.5 billion of its devices from the South Asian nation from April to December.
