Apple Opens First Retail Store in India as It Looks to Country for Manufacturing
The iPhone maker aims to diversify supply chain and boost sales in a country where it has struggled to gain traction
2 min
Apple Inc. opened its first retail store in India Tuesday, with Chief Executive Tim Cook celebrating the launch in person, as the company ramps up efforts to diversify its supply chain and boost smartphone sales in the world’s most populous country.
The tech company opened a bricks-and-mortar location in Mumbai, a financial hub in India, and said it is planning to open a second location Thursday in New Delhi, India’s capital.
Mr. Cook said earlier this year that he was focused on India, where Apple has been using financing options and trade-ins to make its products more affordable compared with cheaper alternatives from China.
“India is [a] hugely exciting market for us and is a major focus,” he said on Apple’s earnings call in February.
Fuelling Apple’s push into India is an ambitious project to diversify more of its supply chain away from China. For more than 20 years, Apple’s primary base of manufacturing has been China. But recent turmoil in its China operations has propelled Apple to more aggressively move operations to other countries, such as Vietnam and India, The Wall Street Journal reported.
Outside of China, India is viewed by Apple as the main candidate for producing the iPhone, the company’s most important product that still accounts for roughly half of its sales. India currently accounts for less than 10% of global iPhone production, mostly for selling into the domestic market. Apple’s longer-term goal is to produce 40% to 45% of its iPhones from India, according to Ming-chi Kuo, an analyst at TF International Securities who follows the supply chain.
Apple has encountered problems of building up iPhone manufacturing in India, the Journal previously reported. India doesn’t have the same level top-down governmental coordination that is found in China, which has previously helped clear the way for Apple to build up operations to the scale it needs in the country.
Apple’s main manufacturing partner, Foxconn Technology Group, is also considering a major expansion into India, including expanding iPhone production in an existing plant near Chennai, in the southern Indian state of Tamil Nadu, the Journal reported last month.
Apple has struggled to gain traction in India, where the company previously had mostly been selling its products online or through resellers and retail chains.
India is the world’s second-biggest smartphone market, both in terms of annual shipments and sales, according to market intelligence firm IDC. It accounts for almost 12% of the global market.
The retail stores are among Apple’s first steps to try to increase its sales in India. Apple is projected to have a 5% share of the country’s overall smartphone market this year, up from 1% in 2019, according to Counterpoint Research.
The multi storey Mumbai shop is in a bustling commercial area. Apple said the store will use solar panels and renewable energy. It is expected to be one of the company’s most energy-efficient locations. The company has more than 520 stores worldwide, according to its website.
Mr. Cook tweeted a picture of himself outside the Mumbai store on Tuesday, saying, “The energy, creativity, and passion in Mumbai is incredible!”
Copyright 2020, Dow Jones & Company, Inc. All Rights Reserved Worldwide. LEARN MORE
A record-breaking $11 million sale at The Centennial Collection has set a new benchmark for luxury apartment living in Bondi Junction.
As interest rates, inflation and market sentiment fluctuate, investors are being urged to focus on data, not panic.
The federal budget has rattled property investors. But the biggest mistake isn’t the tax changes, it’s the conclusion many are drawing from them.
2 min
The recent budget has forced a reckoning for property investors.
Negative gearing now restricted to new residential builds, the CGT discount gone and on paper, the numbers look different.
And many investors are responding by pivoting toward yield, prioritising cash flow over capital growth in a way that property strategists say misses the point entirely.
“The debate has shifted to yield versus growth as if they are opposing forces,” says Abdullah Nouh, founder of Melbourne-based buyers’ agency Mecca Property Group. “But that framing is itself the mistake.”
Nouh, who works with high-net-worth families and investors on long-term acquisition strategy, argues that capital growth remains the primary driver of genuine wealth creation and that the post-budget environment has made quality assets more important, not less.
The numbers make his case plainly. An additional $500 per week in rental income is welcome. A prestige asset appreciating by $1 million over a market cycle is transformative.
These are not equivalent outcomes, and portfolios built around yield at the expense of location and land value tend to generate income while wealth stands largely still.
The more nuanced shift Nouh is seeing among sophisticated investors is a move toward assets where both outcomes can be engineered simultaneously – established homes on substantial land in quality locations, where the existing dwelling can be repositioned, rental returns improved, and the underlying land value compounds independent of what sits on it.
For investors with existing equity, commercial property is also entering the conversation in a more serious way.
Prestige industrial assets, medical centres and long-leased essential retail offer income profiles that residential property in most capital city markets cannot currently match: longer lease terms, tenants covering outgoings, and greater predictability than the residential tenancy cycle.
“The investors who build lasting wealth are rarely the ones who chased yield or growth exclusively,” says Nouh.
“They are the ones who built a strategy they could sustain – one that generated enough income to hold quality assets through multiple cycles while those assets compounded in value.”
The budget has changed the settings. It has not changed the fundamentals.
A long-standing cultural cruise and a new expedition-style offering will soon operate side by side in French Polynesia.
A&K Sanctuary unveils Kitirua Plains Lodge, a sustainability-focused luxury property shaped by landscape, local craft and contemporary safari architecture.
