Apple may need to source critical iPhone components from China after a fire at Tata Group’s plant in southern India caused significant production disruptions, according to industry insiders. The fire at the Hosur facility in Tamil Nadu, which supplies iPhone back panels and other parts to both Foxconn and Tata’s own assembly plant, has led to an indefinite halt in production. This comes at a critical time as Apple prepares for a surge in demand during the Indian festive season.
Industry experts estimate that the fire could impact up to 15% of local iPhone sales, with Apple facing challenges in meeting the demand for 1.5 million units of iPhone 14 and 15 models during the festive season, which runs from late October to early November. Neil Shah, co-founder of Counterpoint Research, noted that production of older iPhone models from India could see a 10-15% drop, although Apple could mitigate this by importing more components from other countries, including China, or redirecting inventory intended for export to meet Indian demand.
Tata Group, which is the only supplier of iPhone back panels in India, also exports iPhones and parts to the Netherlands, the U.S., and China, with shipments valued at over $250 million in the year ending Aug. 31. While Tata declined to comment on the situation, sources suggest that Apple has a stockpile of back panels sufficient for up to eight weeks, which could prevent an immediate impact on production.
However, if the production stoppage extends, Apple may need to explore alternative solutions, such as setting up additional assembly lines or increasing shifts at its Chinese manufacturing sites. The fire represents a broader challenge for India’s “Make in India” initiative, which has sought to attract foreign electronics manufacturers. Apple’s diversification efforts beyond China have seen success, with Indian production contributing an estimated 20-25% of global iPhone shipments this year, a significant increase from last year’s 12-14%.
The fire-affected Tata plant, employing 20,000 workers, was expected to begin assembling complete iPhones later this year. It remains unclear whether the fire will delay these plans. Tata operates other iPhone facilities in India, including one near Bengaluru and another in Tamil Nadu, which it is acquiring from Pegatron. Despite setbacks, industry analysts, including Prabhu Ram from Cybermedia Research, suggest that improving safety and operational standards will be essential for India’s continued growth as a global electronics manufacturing hub.
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