Apple(US:AAPL) Huan Qiu Wang·2025-08-25 22:57Core Viewpoint - Apple's expansion plans in India face significant challenges as Foxconn recalls approximately 300 engineers from its Indian factory, potentially impacting the production of the upcoming iPhone 17 series [1][2]. Group 1: Impact on Apple's Production - Foxconn's recall of engineers is the second such incident in recent months, raising concerns about production efficiency at the Tamil Nadu facility, which has not yet started producing the iPhone 17 [2]. - The factory currently relies heavily on imports for components, and the loss of experienced engineers may hinder Apple's efforts to localize its supply chain in India [2][4]. - Apple may need to increase imports of displays and rely on local suppliers for casings, but the absence of skilled Chinese engineers could delay the localization process [2][4]. Group 2: Supply Chain Diversification Challenges - Apple's strategy to diversify its supply chain in India is proving more complex than anticipated, requiring the establishment of a new manufacturing ecosystem and infrastructure [4]. - The recent events highlight the vulnerabilities in India's supply chain, with delays in training local engineers and integrating new manufacturing processes potentially leading to production bottlenecks [4][5]. - The reliance on foreign labor and the challenges in meeting labor standards raise concerns about the sustainability of India's manufacturing growth [5]. Group 3: Labor and Geopolitical Issues - Labor issues remain a significant concern, as the expertise of Chinese engineers has been crucial for training local workers and ramping up production [5][6]. - India's manufacturing ambitions are complicated by geopolitical factors, including the need to navigate U.S. policies favoring domestic production, which could impact the expansion of Apple's supply chain in India [7]. - The structural challenges in India, such as labor rights and land acquisition issues, need to be addressed to ensure a resilient supply chain [7].