A report by the Economic Times, which cites two senior industry executives, claims that Taiwanese contract manufacturer Wistron has begun a trial production run of the iPhone 6s Plus model at its Bengaluru facility in India. With the smartphone being locally assembled, the report claims that buyers can expect the prices to drop by about 5-7 percent, but that will only come in effect once the plant increases its production capacity.
As per the senior executives, the delay in price correction is due to facility’s inability to meet the “entire requirement” of the iPhone 6s Plus model in India with the major chunk being imports of units manufactured in China.
It's only when the local manufacturing plan “gains scale” will the buyers see a price correction.
Commenting on the same Tarun Pathak, associate director, of Hong Kong-based Counterpoint said that assembling of units will not help Apple insulate itself from the local duty hikes. He added that Apple will need to look into components and SMT manufacturing in order to insulate itself from price hikes due to customs duties.
The recent Union Budget saw the customs duty rise from 10 percent to 15 percent in December 2017 and once again to 20 percent in February 2018. With Apple currently manufacturing almost all of its smartphones (save for the iPhone SE) in China, the rise in duty saw a noticeable price hike for iPhone buyers in India. At the same time manufacturers that manufacture, source and assemble local were well-insulated from the duty hike.
The report also tells about how Apple is working on its local sourcing initiatives and has now added two more partners from India that brings the total number to five.