The iPhone SE manufacturing facility of Wistron Corporation near Bengaluru was damaged during a recent incident of vandalism by a few workers. The incident that escalated over alleged non-payment of salaries included attacks resulting in property damage and ransacking of thousands of iPhone SE units, leading to an estimated loss of over Rs 400 crore. Although a complaint has been registered at the local authority, the incident made Apple to dispatch additional team members and auditors to the facility for a detailed investigation.
Such violent incidents are increasingly becoming common across India, which in the short run may hurt the company, but in the longer run, will affect jobs and Government of India's vision of transforming India into a global hub for manufacturing. They not only malign the reputation of the country, but also shake the investor confidence.
The central government has been focusing on 'Make In India' initiative for the last five years but the COVID-19 pandemic outbreak witnessed the government leveraging this crisis as an opportunity for the country to becoming self-reliant. Earlier this year, the government launched various schemes including production-linked incentives (PLI) to promote domestic electronic manufacturing and attracted big international names such as Samsung and Apple to expand their manufacturing set-up in India. The scheme was designed not just to help in meeting the domestic requirement but also promote exports from India. Over the next five years, the scheme is expected to lead to the total production of about Rs 11,50,000 crore and generate over 3 lakh jobs.
The International mobile phone manufacturing companies that have applied under Mobile Phone Segment in the PLI scheme included Samsung, Foxconn Hon Hai, Rising Star, Wistron and Pegatron. Out of these, three companies namely Foxconn Hon Hai, Wistron and Pegatron are contract manufacturers for Apple iPhones. The global companies have proposed a production of over Rs 9,00,000 crore. Apple (37 per cent) and Samsung (22 per cent) together account for nearly 60 per cent of global sales revenue of mobile phones and this scheme is expected to increase their manufacturing base manifold in the country.
Industry experts claim that while Wistron will continue its operations in the country given the investments and partner commitments, it may be inclined towards replacing human force with machines wherever possible.