Foxconn to assemble Apple iPhones in India?
I saw an article in today’s Wall Street Journal which said that Apple’s main iPhone manufacturer – Taiwanese company Foxconn Technology Group – is seriously considering assembling iPhones in India and will be sending senior execs over there after Chinese New Year for discussions.
Another contractor, Wistron Corp started assembly of the iPhone SE in 2017 and they now also put together the 6S – so India production is not completely new to Apple.
I really think that Apple would be better off shifting as much production as it can to India because a) the company is already becoming a political football and is an easy target for Xi Jinping to use as leverage, b) because there are just too many low-cost rivals in the Chinese market already and c) because it could use cheap manufacturing in India to expand its overall business.
Theoretically, it could produce iPhones really cheaply in India and then sell them elsewhere with the current fat margins whilst being able to sell iPhones in India at lower margins but at much bigger volumes as the market potential there is huge.
It’s early days, but I think shifting a sizeable amount of production to India is the only way forward for Apple in the country.
Patisserie Valerie’s demise
The second thing I wanted to talk about today is Patisserie Valerie. You will have heard by now that the fancy cake/coffee shop was not able to survive the dramatic discovery last year of a £40m hole in its accounts.
70 of the 200 cafes will close immediately and administrators KPMG are looking to sell the rest as a going concern.
At the risk of sounding like I’m obsessed with Sports Direct chief exec Mike Ashley because I’ve talked about him so much recently, I wonder whether he’s having a cheeky look at the business with a view to buying it.
I would have thought that it could be quite an interesting acquisition as it would go for a song – Ashley likes this kind of thing as you know – and non-profitable outlets could be cut relatively cheaply given the circumstances of its demise.
When Ashley bought House of Fraser last year, he said that he wanted to create a “Harrods of the High Street”.
Well if he could put a Patisserie Valerie in his department stores, surely that would add a touch of class for not that much money?