Global Courant 2023-04-18 13:21:57
Apple has opened its first flagship store in India in a highly anticipated launch that highlights the company’s growing aspirations to expand in the country it also hopes to turn into a potential manufacturing hub.
The company’s CEO Tim Cook posed for photos on Tuesday with nearly 200 Apple fans lining up outside the sprawling 2,600-square-foot store at Reliance-owned Jio World Drive mall in India’s financial capital. Mumbai, the design is inspired by the iconic black and yellow taxis unique to the city.
A second store will open in the national capital New Delhi on Thursday.
“India has such a beautiful culture and incredible energy, and we are excited to build on our long history,” Cook said in a statement.
Apple CEO Tim Cook, left, waves during the store opening in Mumbai (Punit Paranjpe/AFP)
The tech giant has been operating in India for over 25 years, selling its product through authorized retailers and the website it launched a few years ago. But regulatory hurdles and the pandemic delayed plans to open a flagship store.
“The vibe here is just different,” said 23-year-old Aan Shah, who traveled from Ahmedabad in the neighboring state of Gujarat to attend the launch. “It’s not like buying in a normal store. There’s just no comparison. It is so exciting.”
His love for Apple previously took him to store openings in New York and Boston, where he once got a chance to meet Cook.
The store opened for bloggers and technology analysts in a private event on Monday, while many Indian film and television celebrities met Cook that evening.
A man with a Macintosh SE computer stands in line with others outside the store (Punit Paranjpe/AFP)
The new stores are a clear signal of the company’s commitment to investing in India, the world’s second-largest smartphone market where iPhone sales are steadily rising, said Jayanth Kolla, an analyst at Convergence Catalyst, a tech consulting firm.
The stores show “how much India is important to the company’s present and future,” he added.
For the Cupertino, California-based company, India’s sheer size makes the market particularly encouraging.
About 600 million of India’s 1.4 billion people have smartphones, “which means the market is still under-penetrated and the growth prospects are huge,” said Neil Shah, vice president of research at technology market research firm Counterpoint Research.
Between 2020 and 2022, the Silicon Valley company gained some ground in the smartphone market in the country, going from just about 2 percent to 6 percent, according to data from Counterpoint.
Still, the high price tag of the iPhone makes it out of reach for the majority of Indians.
Instead, iPhone sales in the country have thrived among the sliver of upper-middle-class and wealthy Indians with disposable incomes, a segment of buyers that Shah says is on the rise.
Apple committed to making India a bigger manufacturing base (Punit Paranjpe/AFP)
According to data from Counterpoint, Apple has captured 65 percent of the “premium” smartphone market, where prices range from 30,000 rupees ($360).
In September, Apple announced that it would start making its iPhone 14 in India. The news was hailed as a victory for Prime Minister Narendra Modi’s government, which has pushed to ramp up local production since taking office in 2014.
Apple first started production in India in 2017 with its iPhone SE and has since continued to assemble several iPhone models in the country.
Most of Apple’s smartphones and tablets are assembled by contractors with factories in China, but the company began looking at possibly moving some production to Southeast Asia or other places after repeated shutdowns to combat COVID-19 hit the global disrupted the flow of products.
“Large companies were shocked, they realized they needed a backup strategy outside of China – they couldn’t risk another lockdown or a geopolitical breach that would affect their business,” said analyst Kolla.
Currently, India makes nearly 13 million iPhones every year, up from less than five million three years ago, according to Counterpoint Research. This is about 6 percent of iPhones made worldwide — and a small fraction compared to China, which still produces about 90 percent of them.
While Apple pushes to make India a larger manufacturing base, some of its products, including iPhones, are assembled in the country by Taiwanese contract electronics manufacturers Foxconn and Wistron Corp. It also plans to assemble iPads and AirPods in India.
Last week, India’s Commerce Minister Piyush Goyal said the government is in regular contact with Apple to support their operations here and that the company has plans to source 25 percent of their global production from India over the next five years.
The challenge for Apple, according to Counterpoint’s Shah, is that raw materials still come from outside India, so the tech company will have to find a local supplier or bring their suppliers, based in countries like China, Japan and Taiwan, closer. to boost production.
Still, he is optimistic that this goal can be achieved, especially now that India’s labor costs are lower and the government is courting companies with attractive subsidies to boost local production.
“For Apple, it’s all about timing. They only enter a market with full flow when they are confident in their prospects. They see the opportunity here today – it’s a win-win situation,” Shah said.
