China’s iPhone city pivots to manufacturing EVs as India emerges as new Apple smartphone hub

Once a leading producer of iPhone, Zhengzhou, a city in China, is now bustling with brand new EVs. Wondering why? It is because Apple has been rapidly shifting manufacturing to India, making this Chinese city undergo a massive industrial transition as BYD along with other automakers pace up with building electric vehicle supply chain here.

Until Apple ditched China to choose India for manufacturing iPhone the economy of Zhengzhou, the capital of Henan province, depended heavily on the assembly of iPhones by Foxconn.

Apple began manufacturing phones in India and other countries due to rising geopolitical risks in China.

Meanwhile, a report in Nikkei Asia, stated that Foxconn, a Taiwanese company, assembled nearly 60 per cent of all iPhones after it had set up its largest factory in the city in 2010.

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As per Zhengzhou statistics bureau, mobile phone production in 2023 totaled about 140 million handsets, half of the 2017 peak.

iPhone global producer is now an EV hub

As per Nikkei Asia report, late October this year the sight around a BYD plant in Zhengzhou saw just EVs all over, many of which were being loaded onto trailers and shipped off.

The employees at the BYD plant which began operations in stages from April 2023 had “new hire” armbands.

Last year, BYD produced 200,000 vehicles at the plant and has an aim to double the number this year.

Aim to produce over 1.5 million new EVs in 2025

In September this year, Zhengzhou Mayor He Xiong said that the city plans to produce over 1.5 million new energy vehicles in 2025.

He further set a goal of 60 per cent of parts being procured locally.

Companies investing in Zhengzhou

There are several other companies which are investing in new energy vehicles in Zhengzhou.

State-owned SAIC Motor invested 2 billion yuan ($277 million) to build a battery factory that began operations in October.

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The Nikkei Asia report quoted an executive of SAIC as saying that the company plans to make Zhengzhou “a base for the production and export of new energy vehicles.”

Meanwhile, a leading bus manufacturer in China, Yutong Bus, is boosting production of electric buses in Zhengzhou.

China has been battling to uplift its dwindling economy. Back in 2022, An Wei, secretary of the party’s municipal committee in the city and its top official, said that he would make Zhengzhou China’s largest production base for new energy vehicles.

Soon after policies including research and development subsidies, sales-based incentives were introduced, with the aim of accumulating technologies for batteries, motors and autonomous driving.

Apple ramps up iPhone production in India

The percentage of iPhones produced in India stands is expected to reach 25 per cent in a few years, Nikkei Asia mentioned Chinese media reports as saying.

Foxconn has announced planned investments in India, and Tata Group subsidiary Tata Electronics is also expanding its contract manufacturing.

However, in China, a local Foxconn, quoted by Nikkei Asia, said: “We used to work in three shifts during the busiest times, but now we’re working in two shifts.”

The Foxconn plant in Zhengzhou at its peak employed about 350,000 people. However, the number has now been slashed to the tens of thousands due to automation, the report quoted a local recruitment agency as saying.

Not just Zhengzhou, but assembly of iPhones was the backbone of the economy of Henan province too. Mobile phones accounted for more than 60 per cent of the province’s exports from 2015 to 2017, but dipped to 46 per cent by 2023.