Apple’s AirPods Production Shift to India Signals Major Supply Chain Realignment

Apple’s supply chain strategy is undergoing its most significant transformation in decades, and the latest AirPods production expansion in India reveals just how serious the tech giant is about reducing its China dependency. According to reports from The Economic Times, Foxconn is preparing to double monthly AirPods production capacity at its Hyderabad facility from 100,000 to 200,000 units—a move that speaks volumes about Apple’s broader geopolitical and manufacturing calculus.

The Hyderabad Expansion: Scale and Strategy

Foxconn’s Hyderabad facility represents more than just another manufacturing outpost—it’s becoming a cornerstone of Apple’s post-China production blueprint. The planned doubling of capacity involves what sources describe as an “overhaul” of five existing production lines specifically for new AirPods models. What’s particularly telling is the workforce expansion: Foxconn will more than triple its employee count from around 2,000 to approximately 5,000 workers. That’s not merely scaling up—that’s building an entirely new manufacturing ecosystem.

The investment numbers underscore the commitment. Foxconn is pouring ₹48 billion (approximately $575 million) into this expansion, including ₹30 billion already deployed. Interestingly, some of the machinery will reportedly be relocated from Foxconn’s Vietnam facilities, suggesting Apple is strategically reallocating resources across its emerging manufacturing network rather than simply adding capacity everywhere simultaneously.

Beyond China: Apple’s Manufacturing Diaspora

This AirPods expansion fits into a much larger pattern that’s been developing over the past three years. Apple’s gradual exit from China began as a cautious diversification strategy but has accelerated into a full-scale supply chain overhaul. The Vision Pro’s production move to Vietnam earlier this year was just the latest in a series of calculated shifts that now includes substantial iPhone manufacturing in India and expanded operations across Malaysia and Thailand.

What makes the AirPods move particularly significant is the product category itself. AirPods represent Apple’s wearable technology future—a high-growth segment where manufacturing precision and supply chain reliability are paramount. Moving such a strategically important product line out of China demonstrates that Apple’s diversification isn’t just about lower-margin devices but encompasses their entire product ecosystem.

The India Advantage: More Than Just Labor Costs

While labor costs certainly play a role in Apple’s India strategy, the real advantage may be geopolitical. Electronics manufactured in India currently enjoy exemption from US tariffs—a crucial consideration given that the expanded AirPods production will serve not just the Indian market but also the United States and Europe. This tariff advantage creates a compelling economic case that goes beyond simple manufacturing cost calculations.

India’s manufacturing capabilities have matured significantly in recent years. The country has moved beyond basic assembly to develop genuine competency in complex electronics manufacturing. The fact that Apple already manufactures most of its US-bound iPhones in India suggests the infrastructure, skilled workforce, and supply chain ecosystem have reached a tipping point where they can support Apple’s demanding quality standards.

Competitive Landscape: Who Follows Apple?

Apple’s manufacturing moves have historically served as bellwethers for the entire electronics industry. When Apple began serious iPhone production in India, competitors took notice. Now, with AirPods joining the migration, we can expect Samsung, Google, and other tech giants to accelerate their own China diversification strategies.

The timing is particularly interesting given ongoing global supply chain uncertainties. From pandemic-related disruptions to geopolitical tensions and trade policy shifts, manufacturers are seeking stability through geographic diversity. Apple’s aggressive India expansion suggests the company has concluded that the era of concentrated manufacturing in China is ending, and the future belongs to distributed, resilient supply networks.

Broader Implications: Reshaping Global Electronics Manufacturing

This isn’t just about Apple—it’s about the fundamental restructuring of how consumer electronics are made and distributed globally. The Hyderabad expansion represents another step toward what industry analysts call the “China Plus One” strategy, where companies maintain some Chinese manufacturing while building substantial capacity elsewhere.

What’s different about Apple’s approach is the scale and speed. The company isn’t just dipping its toes in alternative manufacturing locations—it’s building comprehensive capabilities across multiple countries simultaneously. The Vietnam move for Vision Pro, the established iPhone production in India, and now the AirPods expansion all point toward a coordinated, multi-front manufacturing strategy.

Future Outlook: The Next Phase of Apple’s Manufacturing Evolution

Looking ahead, Apple’s manufacturing transformation appears to be entering a new phase. The company’s parallel $600 billion US investment commitment and American Manufacturing Program—which includes moving iPhone and Apple Watch cover glass production stateside—suggest a sophisticated multi-region strategy rather than a simple shift from China to Southeast Asia.

The real test will come as Apple introduces new product categories and refreshes existing ones. If next-generation AirPods or entirely new wearable products debut with substantial manufacturing outside China, that will signal that the transition is complete. For now, the Hyderabad expansion represents another decisive step in what has become one of the most significant supply chain transformations in modern corporate history.

What’s clear is that Apple sees the writing on the wall. The era of hyper-efficient, China-centric manufacturing carried too many hidden costs in terms of geopolitical risk and supply chain vulnerability. The AirPods production doubling in India isn’t just about making more wireless earbuds—it’s about building the resilient, diversified manufacturing foundation that will support Apple’s growth for the next decade.