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Violence at Wistron’s factory may affect Apple’s “Made in India” plan
According to Indian media ETTelecom, not only Wistron, but the violence may also be a big setback for Apple.
On December 11, local time, a violent incident occurred at Wistron's assembly plant in southern India due to labor disputes, with estimated losses of US$60 million. Currently, the factory has been closed.
Although Wistron did not disclose specific details, an anonymous person familiar with the matter said that the factory's smart phone assembly area and PCB and other precision parts production lines were destroyed.
Wistron stated in a document submitted to the Taiwanese regulatory agency that the company is trying its best to restore the plant to operations. But according to two people familiar with the matter, the plant may face difficulties in restarting. One of the sources pointed out that the violence has largely disrupted Wistron’s local business.
On December 11, local time, a violent incident occurred at Wistron's assembly plant in southern India due to labor disputes, with estimated losses of US$60 million. Currently, the factory has been closed.
Although Wistron did not disclose specific details, an anonymous person familiar with the matter said that the factory's smart phone assembly area and PCB and other precision parts production lines were destroyed.
Wistron stated in a document submitted to the Taiwanese regulatory agency that the company is trying its best to restore the plant to operations. But according to two people familiar with the matter, the plant may face difficulties in restarting. One of the sources pointed out that the violence has largely disrupted Wistron’s local business.
It is reported that Wistron had hoped to recruit 15,000 to 20,000 employees in the next year, and plans to assemble another new iPhone model in addition to the iPhone SE. But now, it may take weeks or even months for this assembly plant to recover.
In addition, three people familiar with the matter said that if Wistron’s business continues to be disrupted, the company may lose most of its incentives this year.
The report pointed out that in order to participate in the production incentive plan (PLI) proposed by the Indian government, Wistron earlier promised to invest about 13 billion rupees ($17.674 million) in the smartphone manufacturing business in the next five years. However, when the violence broke out and Wistron closed its factories, whether related businesses could continue to become an unknown.
On the other hand, Apple is reviewing whether Wistron has violated its supplier guidelines, and the Indian Ministry of Labor is also investigating the latter's alleged wage arrears.
Although government officials in New Delhi and Karnataka where the plant is located, they have assured Wistron of their support. But industry executives and industry analysts said that Apple may seek to deepen its relationship with other foundries in India.
All along, Apple expects to use "Made in India" to avoid the adverse effects of the Sino-US trade war. In addition to Wistron, Pegatron and Foxconn have already deployed in India.
Among them, Tong Zixian, the chairman of Pegatron, recently emphasized that Pegatron will start mass production in India as soon as the second half of next year as planned. In addition, Hon Hai's production expansion in Chennai will not be suspended due to the Wistron incident.
In addition, three people familiar with the matter said that if Wistron’s business continues to be disrupted, the company may lose most of its incentives this year.
The report pointed out that in order to participate in the production incentive plan (PLI) proposed by the Indian government, Wistron earlier promised to invest about 13 billion rupees ($17.674 million) in the smartphone manufacturing business in the next five years. However, when the violence broke out and Wistron closed its factories, whether related businesses could continue to become an unknown.
On the other hand, Apple is reviewing whether Wistron has violated its supplier guidelines, and the Indian Ministry of Labor is also investigating the latter's alleged wage arrears.
Although government officials in New Delhi and Karnataka where the plant is located, they have assured Wistron of their support. But industry executives and industry analysts said that Apple may seek to deepen its relationship with other foundries in India.
All along, Apple expects to use "Made in India" to avoid the adverse effects of the Sino-US trade war. In addition to Wistron, Pegatron and Foxconn have already deployed in India.
Among them, Tong Zixian, the chairman of Pegatron, recently emphasized that Pegatron will start mass production in India as soon as the second half of next year as planned. In addition, Hon Hai's production expansion in Chennai will not be suspended due to the Wistron incident.