Apple to manufacture AirPods in India, but will they make it cheaper?

News Mania Desk / Piyal Chatterjee / 15th December 2024

Apple is scheduled to begin producing AirPods in India, a significant milestone in its quest to extend production outside China. This move is part of Apple’s larger goal to strengthen its position in India’s burgeoning electronics manufacturing industry. However, whether this transition would result in cheaper pricing for Indian customers is unknown.

Foxconn Technology Group, a key Apple supplier, will manufacture AirPods at a new plant near Hyderabad in Telangana. According to Bloomberg, trial production has already begun, with full-scale manufacture set to begin in the first quarter of 2024. So, will AirPods get cheaper?

Several variables affect product pricing, including local taxes, production costs, demand, and Apple’s pricing strategy. While local manufacturing may assist cut costs associated with import tariffs and transportation, this may not instantly result in considerably cheaper consumer pricing. Apple has a reputation of charging a premium, so any prospective price reductions may be minimal. However, if Apple improves manufacturing capacity and there is greater demand for AirPods in India, local manufacture might help with speedier availability and potentially lower costs in the long run.

In July 2024, months before the release of the iPhone 16 series, Apple dropped the price of the iPhone 15 series for the first time in several years. Typically, the corporation announces price reductions after launching new models. So, what caused this early reduction?

Earlier this year, measures like as India’s 2024 Union Budget improved the business environment for electronics manufacturing. Finance Minister Nirmala Sitharaman announced a decrease in basic customs tax on mobile phones and chargers, lowering the total customs duty to 16.5%. This encouraged firms such as Apple to enhance their domestic production. Following the duty reduction, Apple slashed the cost of iPhone 15 models in India, providing savings of up to Rs 6,000 on the iPhone 15 Pro series. Similar decreases might occur with AirPods, although the magnitude is unknown.

While a significant price reduction may not materialize immediately, producing AirPods locally might have long-term advantages for Indian consumers. As production increases and Apple extends its local manufacturing capability, there may be more competitive pricing and faster availability in the future.