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Apple Opens Its First Store in India, Diversifies Supply Chains Away From China

Apple Opens Its First Store in India, Diversifies Supply Chains Away From China

Giant tech company Apple has opened its first store in India as it diversifies its supply chains away from China, one of its biggest markets.

The tech company on Tuesday opened its first flagship store in Mumbai, in a much-anticipated launch that highlights the company’s growing aspirations to expand in the country with the hope of turning it into a potential manufacturing hub.

Announcing the launch of Apple’s new store in the Asian country, the company’s CEO Tim Cook posted a photo on his Twitter handle where he posed with several Apple workers. He wrote, “Hello, Mumbai! We can’t wait to welcome our customers to the new Apple BKC tomorrow.”

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The recently launched store at Jio World Drive in Mumbai’s Bandra Kurla Complex (BKC), is spread over 20,000 square feet over two levels, about a third the size of Apple’s flagship store in New York but similar to its outlets in London.

Apple claims its Mumbai store is “one of the most energy-efficient” locations in the world and has a dedicated solar energy system and has zero reliance on fossil fuels for the store’s operations. Apple BKC runs on 100% renewable energy, Apple said.

The second store will open in Delhi on Thursday, April 20. The outlet will be smaller at an estimated 8,400 square feet. It is however interesting to note that Apple has been operating in India for more than 25 years, selling its products through authorized retailers and the website it launched a few years ago. But regulatory hurdles and the pandemic delayed its plans to open a flagship store.

The new stores are a clear signal of the company’s commitment to invest in India, its second-largest market where iPhone sales have been ticking up steadily. Apple first began to manufacture its iPhone SE in India in 2017 and has since continued to assemble a number of iPhone models from the country.

Most of Apple’s smartphones and tablets are assembled by contractors with factories in China, but the company started looking at potentially moving some production to Southeast Asia or other places after repeated shutdowns over covid-19 concerns. This forced Apple to temporarily reduce iPhone 14 production because of Covid-19 restrictions at its primary iPhone 14 Pro and iPhone 14 Pro Max assembly plant in Zhengzhou, China.

The tech giant said its assembly plant in Zhengzhou, China is now operating at a significantly reduced capacity. It also warned that following the disruptions, it would ship fewer units and that customers would experience longer wait times when ordering devices.

Analysts stated that following the disruptions in the production of its products in China, Apple realized it needed a backup strategy outside of China, as they do not want to risk another lockdown or any geopolitical rift affecting its business.

Apple’s India push offers the opportunity for the technology giant to boost revenue and iPhone sales near the levels seen in markets like the U.S. and China. The company’s CEO Cook has long viewed India as a key market to Apple’s future and in February he said he was “bullish” on the world’s fifth-largest economy and the company is putting a “significant amount of energy” into the market.

Currently, India makes close to 13 million iPhones every year, up from less than 5 million three e years ago, according to research. This is about 6% of iPhones made globally. The country through its commerce minister Piyush Goyal has assured Apple that the government will give them the needed support they require for the business to blossom.

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