Apple supplier Foxconn will treble India plant staff

Foxconn (2317.TW), a big Apple (AAPL.O) supplier, is rumoured to be planning to hire more than twice as many people at its iPhone factory in India over the next two years. This is part of the company's plan to adjust production because of problems in China.

Apple supplier Foxconn

In recent weeks, Foxconn has been in the spotlight due to rigorous virus restrictions at its Zhengzhou facility, the world's biggest iPhone manufacturing facility, which have disrupted production and fueled worries about the effect of China's viral policies on global supply chains.

Because of these problems, Apple has lowered its shipping estimates for the high-end iPhone 14 models. This has lowered the company's sales expectations for the important Christmas shopping season.

Sources in southern India said that Taiwanese electronics manufacturer Foxconn is planning to hire 53,000 additional workers over the next two years to increase the number of employees at its facility there from 40,000 to 70,000.

Apple needs the facility in Tamil Nadu, India, in order to move production out of China, even though it is much smaller than Foxconn's Zhengzhou plant, which has 200,000 workers.

Formerly known as Hon Hai Precision Industry Co. Ltd., Foxconn started its India unit this year and is rapidly increasing output. As of this year, it has started making the iPhone 14.

Although Foxconn's intent to expand the site has been widely publicised, details on the expansion's scope and anticipated timetable have been few.

Apple and Foxconn both said they couldn't comment.

Foxconn Chairman Liu Young-way said on Thursday's earnings call that the company would change its production capacity and output to make sure that the Christmas and Lunar New Year holidays would not be affected by any more possible supply problems.

The first government source says that Foxconn has told officials in Tamil Nadu that it plans to hire more people at its plant in India because of problems in China.

The plant produces goods for a number of global technology companies in addition to iPhones, but the new hiring push has been spurred by the need to meet rising demand for iPhones, the source said.

According to a Taiwanese source familiar with the situation, Foxconn is increasing its operations in India to enhance its capacity for basic models and to fulfil Indian demand.

Its representative in India said, "We're slowly increasing the size of our production there," but he or she wouldn't say more about how the company plans to hire more people in India.

An additional Indian government official has confirmed that Foxconn is "finalising" its expansion in the state of Tamil Nadu.

The state's investment promotion arm tweeted on the 27th that high-ranking officials had met with Liu in Taiwan. The report says that the government has "extended its full support" to Foxconn's plans for new projects and investments.

The first government official said talks were underway with the suppliers to address issues like worker housing as the state planned to expand.

Foxconn's Tamil Nadu plant was the epicentre of a mass food-poisoning incident last year, which resulted in employee protests and shed light on the squalid conditions in the nearby dormitories where many of the workers lived.

Two government sources added that officials in Tamil Nadu, a centre for electronic and automotive production, were pressuring Apple suppliers to expand beyond assembly into component manufacturing for iPhones.

At the moment, iPhones are made in India by Foxconn (2317.TW), Pegatron (4938.TW), and Wistron (3231.TW), three of Apple's global suppliers.

In September, analysts at JP Morgan predicted that by 2025, Apple could be producing one in four iPhones in India and that the company's total percentage of products manufactured outside of China would rise to 25% from the current 5%.