Foxconn India Faces Turmoil as Chinese Engineers Exit

Hundreds of Chinese engineers and technicians employed at Foxconn's facilities, Apple's primary supplier, were urged to leave as the company prepared to increase manufacturing of its next flagship iPhone in India.

According to various media reports, more than 300 highly qualified employees have left Foxconn's iPhone factories in southern India. Although neither Apple nor Foxconn have made a formal statement, the timing and lack of response say a lot.

This advancement goes beyond a simple reorganisation of personnel. It coincides with rising tensions between Beijing and Western tech companies that are moving their manufacturing out of China, as well as the India-China border issue.

The loss of skilled Chinese technical employees is a blow to Apple, which has made significant investments to increase its manufacturing presence in India. In addition to putting devices together, these experts trained Indian workers and imparted decades of process knowledge developed inside Chinese mega-factories.

Chinese Government Clamping Down on Various Elements to Hamper the Production

In recent months, China's crackdown on the exodus of talent, equipment, and technology has intensified.

A media source claims that the Chinese government has gently persuaded businesses and authorities to limit the flow of talented workers to countries like India and Southeast Asia and to cease exporting vital equipment.

It appears that the goal is to slow down the "China plus one" method that global corporations are using to protect themselves from geopolitical risk.

China has tightened control over APIs for the global pharmaceutical supply chain, limited exports of rare earth magnets used in electric vehicles, and, now, through its hold on Foxconn, has started to repress talented mobile manufacturing workers. Trade friction is no longer the only issue. Supply chain resistance is the cause.

India Benefiting from US-China Trade Tension

Trade conflicts between the US and China, which started under former President Donald Trump, are the direct cause of Apple's entry into India.

These tensions have now developed into strategic actions on both sides, with China retaliating with limits on technology, talent, and raw materials and the United States providing tax incentives and trade agreements to nations like Vietnam and India.

Though it might not seem as dramatic, China's most recent action might be just as destructive as a trade battle. The risk is growing on both sides for Apple, which intends to manufacture the majority of iPhones for the US in India by 2026.

Trump has once again called on Apple to "make in America" in his most recent campaign speech. However, Apple has so far steered clear of that route due to the high cost of US labour and a lack of experience with large-scale manufacturing.

Now that China is exerting pressure behind the scenes, even Apple's backup plan in India can encounter difficulties.

In the months preceding the release of the iPhone 17, it will become evident if China has successfully halted the changing axis of tech manufacturing or whether Apple can withstand the transition without compromising its production targets.