Apple is reportedly in exploratory conversations with at least one partner to potentially handle iPhone chip assembly and packaging in India for the first time. Here are the details.
Apple and India tighten their manufacturing ties
According to The Economic Times, Apple is in preliminary talks with CG Semi to assemble and package unspecified future iPhone chips.
CG Semi is a semiconductor company in India, which has been building one of the country’s first major outsourced semiconductor assembly and test (OSAT) facilities.
According to The Economic Times, it is currently unclear which chip CG Semi would be assembling and packaging:
“The companies are in the very initial stages of discussion,” one of [their sources] said. “It is not clear what chips will be packaged out of the Sanand facility at this stage, but it will likely be display chips.”
As The Economic Times explains it, Apple’s iPhone OLED panels are sourced from Samsung Display, LG Display, and BOE. At the same time, its display driver integrated circuit (DDIC) comes from Samsung, Novatek, Himax, and LX Semicon, “which primarily depend on South Korean, Taiwanese or China-based units for getting chips manufactured and packaged.”
If the deal goes through, it will mark yet another step in Apple’s ever-increasing reliance on India, which has served as the company’s primary assembly hub in its diversification away from China.
Interestingly, this has been a busy week for chip manufacturing news coming from India, as Intel has just struck a partnership with Tata Electronics. Here’s The Economic Times:
According to the agreement of December 8, the companies will explore manufacturing and packaging of Intel products for local markets at Tata Electronics’ upcoming fab and OSAT facilities. They said they would explore collaboration for advanced packaging in India. Packaging is critical in the chip business because it protects internal elements and improves efficiency, among other factors.
Be it as it may, these are reportedly just preliminary discussions. Even if the talks progress, one source told The Economic Times that this could be “the beginning of an uphill climb” for CG Semi, given Apple’s quality requirements:
“Apple is already in talks with several companies for a number of other supply chain functions, and very few will end up on their supplier list,” the person said.
CG Semi, for its part, has the Indian government on its corner. The company’s ₹7,600 crore OSAT plant has central and state government support, as part of the India Semiconductor Mission, which aims to establish the country as a semiconductor and display manufacturing hub.
Whether an uphill climb or not, scoring a deal with Apple would surely let the Indian government and CG Semi say that this vision is right on track.
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