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I’d be curious to know which parts of the manufacturing process are carried out in India. I assume it includes “final assembly”. But does all CNC work, PCB asse
by new299 7y ago
I’d be curious to know which parts of the manufacturing process are carried out in India. I assume it includes “final assembly”. But does all CNC work, PCB assembly happen in India?
PCB assembly in particular, seems unlikely? The supply chains are all in China, and it’s a largely automated procsss.
- rubyn00bie 7y agoIt's been hard for me to find a definitive number [1], and what that actually means, but it looks like to labeled something as "made in India" companies are required to have 30% of the final product locally sourced. [1] https://indianexpress.com/article/technology/tech-news-technology/xiaomis-make-in-india-strategy-to-include-30-local-sourcing-criteria-2826436/ https://indianexpress.com/article/technology/tech-news-techn... I linked this article because the bit at the bottom: > According to the foreign direct investment rules [...] “sourcing of 30 per cent of the value of goods purchased will be done from India, preferably from MSMEs, village and cottage industries, artisans and craftsmen, in all sectors”
- mikepurvis 7y agoI feel like getting to 30% of the value would be a stretch if the ICs, PCB assembly, and possibly screen are coming from China and Taiwan/TSMC. Like, the case and battery are worth something, but not tons.
- londons_explore 7y agoIt's pretty easy to value custom built components whatever you like. They are either very cheap components, but you paid a massive r&d grant to have them designed for you, or they are very expensive components but you paid no r&d costs. Choose whatever suits to best avoid taxes, quotas, fees, and regulations...
- formercoder 7y agoThe magic of GAAP
- khuey 7y agoFor extra points make different choices in different tax jurisdictions.
- mikepurvis 7y agoI guess that's true. If you're not actually selling them other than in your device, you can argue that they're basically worthless as bits of plastic and metal, and all the "value" is being created by the India-based assembly process that turns them from parts into functioning phones.
- fastball 7y agoNot if you're paying X to produce these parts. You can't say "this part is only worth $10" if it's costing you $100 to produce.
- mikepurvis 7y agoDoes it actually cost $100 to produce an IC, though? Like, the manufacture of the device itself is relatively cheap, especially in volume— all the cost is R&D, test harnesses, simulation, license fees, etc.
- ksec 7y agoThat is not entirely true, you cant just name an R&D budget, you have to show it in some way.
- amdavidson 7y agoIt is super true if you are using outside resources for R&D/NREC. Line item on the PO or wrap it into the part costs.
- demodifier 7y agoThis particular requirement is tied to operating what's called a single-brand retail outlet in India. That would be Apple-owned Apple Stores. It is not clear to me if this is a requirement for foreign manufacturers who are manufacturing/assembling products in India and then exporting them.
- envolt 7y agoThis is why it took this much time for Apple to set it up.
- trevyn 7y agoThe phones are labeled "Assembled in India", not "Made in India", and have less than 30% locally sourced materials. There is some discussion to possibly meet this level eventually, but it is not currently the case.
- distant_hat 7y agoApple asked for and got exemptions to the 30% rule.
- dsl 7y agoApple already uses multiple suppliers for each stage of production, so shipping production lines to other countries wouldn't be that difficult. Beyond that you'd just be sourcing bulk components, which I'm sure their Chinese suppliers will happily ship to India. Raw materials like the aluminum could be locally sourced.
- umeshunni 7y ago> which I'm sure their Chinese suppliers will happily ship to India That's a good point. The requirements seems to be about locally sourcing components, not locally manufacturing them. It's entirely possible for a Chinese company to have a subsidiary in India that's supplying components to Apple.
- solarkraft 7y agoNote that largely automated processes are quite easygoing to move between regions, since labor cost is not a significant factor.
- avemuri 7y agoI think it's still done by Foxconn, just at an Indian facility. Chinese company in India, not domestic capability.
- AareyBaba 7y agoFoxconn is a Taiwan based company.