Enough iPhone buffer stock in place, Chennai rains won't hit Apple's business
Apple's iPhone business in India will have no impact from the reported factory closure in Chennai due to the extreme weather situation in Chennai owing to cyclone Michaung, said industry executives close to the company.
They said Apple ensures there are enough buffer stocks of iPhones in distribution to deal with such situations.
«Apple does not work in a just-in-time inventory model, where a day of downtime impacts supplies. They ensure there is enough stock to tide over a week-long disruption,» said one of the executives, who did not wish to be identified.
The executives said Apple treats worker safety as the top priority in such situations and that this has been communicated to its suppliers in the cyclone-affected area.
Production was yet to resume at Foxconn and Pegatron facilities in Sriperumbudur near Chennai on Tuesday, despite an improvement in weather, after being halted following heavy rains impacting day-to-day life in the coastal city and its outskirts.
Taiwan-headquartered Foxconn and Pegatron are two of Apple's key local assemblers of iPhones and are part of the government's production-linked incentive scheme.
The two facilities are also key to driving India's mobile phone manufacturing growth as well as exports.
Apple is targeting to produce nearly '1 lakh crore worth of iPhones in India in this financial year, with capacity expansion at the two plants resulting in '60,000 crore worth of production in the first seven months of the fiscal.
The Foxconn unit in Chennai currently makes the latest iPhone 15 model along with older models, which are also exported to other regions. The disruption comes at a time when the holiday season is set to begin in the western countries which sees a surge in iPhone
