iPhone manufacturing in India faces setbacks – Wistron pulls out

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People exit from the gate of Wistron, a Taiwanese-run iPhone factory at Narsapura, about 60 km from Bangalore on December 13, 2020. - Authorities vowed to crack down on workers who went on a violent rampage at a Taiwanese-run iPhone factory in southern India over allegations of unpaid wages and exploitation, with 100 people arrested so far. (Photo by Manjunath Kiran / AFP) (Photo by MANJUNATH KIRAN/AFP via Getty Images)

Apple has increased its capital in India in recent years and even wants to transfer iPhone production to India. Many foundries have increased investment in India, but there are also suppliers that have invested in India before. While the prospect of Apple in India is great, there are also issues. One of the main issues is the supply chain and it just got worse. One of Apple’s main suppliers, Wistron has just announced its exit from India. According to reports from India, Wistron, Apple’s main supplier, plans to exit India as a whole. It is now setting things up for the National Company Law Tribunal (NCLT) and the Indian Registry of Companies (ROC) to dissolve its business in India within one year.

There are many reasons for Wistron’s exit, including worker issues, low payment of wages, medical issues and other cases. This has caused the company to always face disputes in India. After Wistron’s exit, India’s Tata Group plans to buy Wistron’s iPhone assembly plant in South India. This plant handles Wistron’s main production tasks in India. There are also reports that Wistron chose to end its business in India after getting subsidy payments under the Indian Mobile Phone Production Linked Incentive Program (PLI). Sources said that after the exit, Wistron’s business in India only provides repair and maintenance services for Apple products.

At the end of April, Apple CEO Cook visited India. During the visit, he said that Apple is committed to developing and investing across the country. Apple is now looking to expand co – operation with Foxconn, Pegatron, etc. so that nearly 7% of iPhones are produced in India. This is a major leap forward for India, which is slated to account for only 1% of the world’s iPhones in 2021.

Wistron India has a shaky history

Wistron India is the Indian sub – brand of Wistron Corp., a Taiwan – based electronics services company. The company was formed in India in 2006 and has its HQ in Bangalore. Wistron India focuses on the production of electronic products, including mobile phones, tablets, and PCs, and provides design and engineering services to its users.

History

Wistron Corp. was a sub – brand of Acer, a Taiwanese electronics company. Acer’s contract manufacturing operation was spun out in 2001 and is now known as Wistron Corp. Since that time, Wistron has grown to be one of the top contract brands in the world. The company makes gadgets for many of the top tech giants, including Apple, Dell, and HP.

With the goal of growing its role in the Asia – Pacific area, Wistron founded its Indian sub – brand in 2006. At first, Wistron India focused on giving its clients design and engineering services. The company built its first manufacturing plant in 2008, but it swiftly grew its manufacturing capacity.

Wistron and Apple work with each other. After it came to light that Wistron had broken labour laws with regard to people working at its plants in China, Apple placed the company on trial. In China, Apple has alsi made efforts to protect labour laws across its vast tech supply chain. Wistron has 12 plants globally and 120,000 staff. While it is growing from the mainland, it won’t happen quickly or easily. India is seen by Wistron to be an option for China, however, the company’s business strategy that was a success in mainland China may not be as effective there.

Products and Services

Clients can choose from a variety of design, engineering, and manufacturing services offered by Wistron India. The company focuses on the production of electronic goods, such as laptops, tablets, and mobile phones. Production, supply chain management, logistics, and product design and development are among the services that Wistron offers in India.

With many of the top tech firms in the world, such as Apple, Microsoft, and Dell, Wistron India has formed ties. Surface – mount tech, printed circuit board assembly, final assembly, and testing are among the firm’s production skills. Bangalore and Noida are where Wistron India’s production facilities are based. In India, Wistron India has also made stakes in R&D projects. Bangalore now serves as the company’s R&D hub, where it focuses on creating new products and techs for its clients.

Challenges and Controversies

In recent years, Wistron India has faced a number of hurdles and issues. A major labour protest took place at Wistron India’s production plant in Narasapura, close to Bangalore, in December 2020. Staff at the company claimed that they were not paid their wages on time and that their hours at work were harsh. Workers at the factory damaged cars and machinery as a result of the violent protest.

The Karnataka state govt opened a probe against Wistron India’s labour practices after the event. The govt found that the company had broken a number of labour rules, including not paying salaries and failing to provide suitable working conditions. Wistron India was thus removed from the Karnataka state govt’s list of approved producers, and the company was forced to change its labour policies.

Wistron India has come under fire for its environmental practices in addition to labour issues. The Karnataka State Pollution Control Board hit the company in 2019 for breaking environmental laws. The board found that Wistron India had polluted the local groundwater by dumping untreated waste into the environment.

People exit from the gate of Wistron

Growth in India

Wistron India has big goals to grow its company there. A new plant was built in Narasapura, close to Bangalore, with a cost of Rs 1,200 crore (about $164 million) by the company. The plant makes electronic devices for Wistron’s clients. It was a huge source of jobs for many Indians and it did get huge returns. The Indian govt., which has been selling the nation as an option for global investment, has praised the growth plans. India has a sizable and expanding market for consumer electronics. At some point, Wistron did have a huge positive impact on the Indian local economy. However, it appears that the romance is all over.

Conclusion

One of the biggest contract brands in India, Wistron India, offers design, engineering, and manufacturing services to some of the top tech brands in the world. In recent years, the company has dealt with a number of issues and issues, including labour disputes and environmental crimes. To address these problems and enhance its labour and environmental practises, the company in India has taken action. However, the company can no longer cope with all the issues in India. The company thinks the Asian nation to be a hard region to work in and will now take a bow and leave. This will affect Apple’s planned expansion in India because Wistron is one of its major supply chains. This means that Apple will have to look for an alternative. This will not be an easy thing for the company.