Foxconn, the Taiwanese contract manufacturer, may invest a whopping $1 billion in a smartphone display module assembly unit, its first ever in Tamil Nadu. The operation would mainly service Apple’s iPhone apart from this. Foxconn also plans to assemble Google Pixel phones in the country.
It shall invest all these areas-technology, effort, and endeavor-in the field of ICT, EVs, batteries, and semiconductors to achieve maximum growth. Industry analysts see this display module assembly unit as a giant step for India in terms of establishing the electronic assembly and manufacturing value chain in the country. While assembling phones add some kind of local value addition at around 5%, the display assembly can add another 2-3%, said Tarun Pathak, research director at Counterpoint. He said there was a need to maximize the value addition within India.
This operational model is created to enable other contract manufacturers like Pegatron or Tata Electronics to use components from the Foxconn unit so that reliance on imported modules from China can be reduced. No specific timeline has been given for the completion of the project. However, sources indicate that Foxconn plans to make this facility operational “as soon as possible.”
Foxconn has bagged around 500,000 square feet of area at a plug-and-play facility in ESR Oragadam Industrial & Logistics Park alongside its existing smartphone assembly unit outside Chennai. For the industry consultants, this comes as the turning point for Indian manufacturing-India imports 60-65% of its display modules from China and 20-25% from South Korea. In assembly processes, the localization can also result in a substantial amount of time saving for the manufacturer in lead time and supply chain cycles, thus allowing the reduction of lead times and costs.
Major display module players in the market include Samsung Display, BOE Technology, LG Display, and AU Optronics, among others. In India, currently, the largest smartphone display assemblers are Chinese companies- TCL CSOT in Andhra Pradesh and TXD (India) Technology in Haryana, serving brands like Samsung, Xiaomi, Vivo, and Oppo.
However, sourcing components and finding a skilled workforce that is familiar with these high-end display technologies are going to be serious issues for India-based units, claim experts. Foxconn’s initiatives are in line with what Apple has been doing in order to diversify the supply chain from China. India is a major concern for most technology players in the world
