Apple could benefit as Foxconn signs new partnership deal in India

The iPhone maker Foxconn will start to produce chips in India with conglomerate Vedanta. With that, Apple could be one of the companies benefiting from this partnership.

As reported by Reuters, Foxconn is trying to diversify its business due to the global chip shortage. Although it’s slowly getting better, the lack of semiconductors still haunts big tech companies.

In a statement, Foxconn said it had signed a memorandum of understanding with oil-to-metals group Vedanta to make semiconductors, calling it “a significant boost to domestic manufacturing of electronics in India.”

Foxconn said it would invest $118.7 million to set up a joint venture company with Vedanta, which would be the majority shareholder of the new venture. Foxconn would hold 40% of the venture’s shares, it added.

This news comes just after Foxconn said it sees signs of component shortages easing, as it was planning for major improvements during the rest of the current quarter.

Although all companies suffered from the global chip shortage, Apple was one of the few that handle this crisis with ease. For example, the Cupertino company did manage a record holiday quarter, even though the component shortages cost around $6B in lost sales in each of the last two quarters.

Despite this, the iPhone maker shares Foxconn’s optimism about this quarter.

“We saw supply constraints across most of our products,” Apple CEO Tim Cook said in an interview Thursday as the company released its results. “We’re forecasting that we will be less [constrained] in March than we were in the December quarter.”

Apple should see year-over-year revenue growth in the quarter that runs January through March, he said, while remaining circumspect about when the industry’s supply issues will clear up long-term.