Tata Group Factory Fire Sparks Trouble for Apple: iPhone Production Faces Festive Season Setback
Apple, the globally renowned American tech company that produces iPhones, is facing a challenge just before the festive season. A fire broke out at Tata Group’s factory, which manufactures key components for iPhones, potentially impacting the production of these smartphones. As a result, Apple may need to source critical components, such as back panels, from China or other countries to meet demand.
The fire occurred last week at Tata Group’s factory in Hosur, Tamil Nadu. This facility supplies essential components like back panels to Apple's contract manufacturer, Foxconn, as well as Tata Group’s iPhone assembly unit. According to market research firm Counterpoint, around 1.5 million units of iPhone 14 and 15 are expected to be sold during the festive season, which runs from October to early November. The fire at the Tata facility could hinder Apple from meeting up to 15% of this projected demand.
As of August this year, Tata Group has exported iPhones worth around $250 million to countries such as the US and the Netherlands, in addition to selling them within India. When approached, Tata Group declined to comment on the incident. Typically, Apple’s suppliers maintain a stock of back panels sufficient for three to four weeks. However, an industry insider revealed that Apple could have up to eight weeks' worth of stock, which means the immediate impact may be limited.
Tata Group is one of Apple’s newer suppliers in India, and locally produced iPhones are projected to account for around 25% of Apple’s global shipments this year, up from 14% last year. Over the past few years, iPhone manufacturing in India has increased significantly.
The affected factory employs about 20,000 workers, and another iPhone assembly unit by Tata Group is expected to begin operations at the same complex by the end of the year. Recently, Apple launched the iPhone 16 series, which is also being manufactured in India. Strong demand for this new series is anticipated.
