INDIA: Wistron, a key supplier for Apple, has decided to sell its iPhone assembly factory in India as it struggled to achieve profitability under Apple’s terms. The move comes as Wistron gradually scales down its operations in the country and plans to reduce its presence significantly in the coming year.
According to reports, Wistron faced challenges in generating long-term profitability solely as an iPhone assembly provider. The company is now shifting its focus to core IT manufacturing operations in countries like Vietnam and Mexico.
An executive stated that Wistron could not profit from its Apple business in India and attempted to negotiate for higher margins.
However, as a smaller player compared to global giants like Foxconn and Pegatron, Wistron lacked the necessary leverage. Despite its role in assembling iPhones, including the iPhone SE, for Apple in India, Wistron struggled to achieve profitability.
Unlike the major suppliers for inventory handling for Apple in India, such as Foxconn and Pegatron, Wistron faced difficulties establishing itself in the business.
Challenges such as the need for effective demand gauging and product shipment to various units contributed to Wistron’s struggles.
The company’s smaller size compared to competitors like Foxconn and Pegatron also presented obstacles.
Additionally, Wistron encountered management issues and faced difficulties retaining workers at its facility in Kolar, India. The report suggests that differences in work culture between China and India contributed to the challenges faced by the company.
The firm did not adequately address Indian workers’ concerns, leading to a high attrition rate.
Wistron is selling its iPhone assembly facility in Kolar, near Bengaluru, to the Tata Group, as part of its restructuring efforts. A previous report from TrendForce indicates that the Tata Group is conducting trials to assemble upcoming iPhone 15 models in India.
Wistron entered the Indian market in 2008 by establishing a repair facility for various devices manufactured by the company, including PCs, laptops, and servers.
In 2017, the tech company expanded its operations and began manufacturing smartphones for Apple. The decision to sell its iPhone assembly factory in India reflects Wistron’s challenges in achieving profitability and competing with larger players in the market.
The company’s focus on core IT manufacturing operations in other countries signals a strategic shift in its business strategy.
Also Read: Apple CEO Tim Cook Sees India as Key Market for Future Growth