In a significant move to strengthen its position as a major Apple supplier, Tata Electronics has agreed to acquire a majority stake in Pegatron’s iPhone manufacturing plant in Chennai, Tamil Nadu. This strategic partnership, which forms a new joint venture, marks Tata’s growing presence in Apple’s global supply chain and further cements its role in India’s fast-growing smartphone manufacturing sector.
Tata Electronics to Take Control of Pegatron’s iPhone Plant
Under the terms of the deal, Tata will acquire 60% of Pegatron’s only iPhone manufacturing facility in India, with Tata overseeing the day-to-day operations of the plant. Pegatron, a Taiwanese contract manufacturer, will retain the remaining 40% stake and continue to provide technical support. The deal, which was internally announced last week, comes as Apple looks to diversify its supply chain amid ongoing geopolitical tensions between China and the United States.
Strategic Move Amid Apple’s Supply Chain Shifts
The deal aligns with Apple’s strategy to move its manufacturing operations out of China and into other countries, including India, as part of its efforts to reduce reliance on Chinese factories. For Tata, the acquisition of the Pegatron plant enhances its capacity to manufacture iPhones in India, positioning the conglomerate as a key player in Apple’s manufacturing ecosystem.
Tata Group is rapidly expanding its footprint in the iPhone manufacturing space, competing directly with Foxconn, the only other major contract manufacturer in India. Tata’s move into iPhone production started last year when it acquired Wistron’s assembly plant in Karnataka, and the company is currently building a third plant in Hosur, Tamil Nadu.
Tata’s Growing iPhone Manufacturing Footprint in India
The new joint venture with Pegatron will be Tata’s third iPhone manufacturing facility in India. The Chennai plant, which has around 10,000 employees, is capable of producing up to 5 million iPhones annually, further strengthening Tata’s capacity to meet growing global demand for Apple devices. Analysts estimate that India will account for 20-25% of total iPhone shipments this year, up from 12-14% last year.
The Tata-Pegatron plant joins Tata’s existing iPhone assembly operations in Karnataka and the new facility under construction in Hosur. Despite a recent setback involving a fire at Tata’s component plant in Tamil Nadu, the company continues to aggressively ramp up its manufacturing efforts in the region.
Deal Approval and Future Outlook
The companies plan to seek approval from the Competition Commission of India (CCI) in the coming days, according to sources familiar with the deal. Although financial details have not been disclosed, the partnership between Tata and Pegatron marks a significant shift in the global iPhone supply chain, with India playing an increasingly important role.
