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Apple supplier Wistron suffers loss after India factory violenceApple supplier Wistron suffers loss after India factory violence

After property damage and looting, other manufacturers may have second thoughts about moving to India.

Gagandeep Kaur

December 15, 2020

2 Min Read
Apple supplier Wistron suffers loss after India factory violence

Apple supplier Wistron India has suffered a loss of nearly 4.4 billion Indian rupees (US$59.4 million) due to violence at its factory at Narasapura, near Bengaluru.

The US-based iPhone maker has now launched an investigation to determine if the contract manufacturer was following guidelines.

The violence was the result of workers going on a rampage over alleged non-payment of salaries.

Apple is investigating about 7,000 people, including 5,000 contract workers, over looting, damage to property and the burning of vehicles.

The police have arrested around 150 people and have detained several others as part of the investigation, according to media reports. It is not clear if the violence will impact the availability of the iPhone SE, a popular model.

"We have teams on the ground and immediately launched a detailed investigation at Wistron's Narasapura facility in India," Apple said in a press statement.

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Spread over 43 acres, the Wistron plant started operations in July this year.

Built with an investment of around INR30 billion ($407.2 million), it has about 2,000 regular employees and is mainly involved in the assembly of the iPhone SE.

Wistron has another factory in Peenya, which has been used to produce the iPhone SE since 2017.

Before the outbreak of violence, it had planned on doubling its capacity of 200,000 units per year and hiring another 10,000 people.

Apple recently began relocating its manufacturing operations to India as it tries to lessen dependency on China amid rising geopolitical tension.

Nine out of eleven of Apple's contract manufacturers have applied to set up units in India to take advantage of the government's Production-Linked Incentive (PLI) scheme. They include Pegatron, Cheng Uei Precision and Foxconn, besides Wistron.

The incident reflects negatively on the Indian government, which has been desperate to promote India as a manufacturing hub and alternative to China.

Apple's decision to relocate some of its manufacturing was seen as a major victory for India and the violence could discourage others from doing the same.

— Gagandeep Kaur, contributing editor, special to Light Reading

About the Author(s)

Gagandeep Kaur

Contributing Editor

With more than a decade of experience, Gagandeep Kaur Sodhi has worked for the most prominent Indian communications industry publications including Dataquest, Business Standard, The Times of India, and Voice&Data, as well as for Light Reading. Delhi-based Kaur, who has knowledge of and covers a broad range of telecom industry developments, regularly interacts with the senior management of companies in India's telecom sector and has been directly responsible for delegate and speaker acquisition for prominent events such as Mobile Broadband Summit, 4G World India, and Next Generation Packet Transport Network.

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