Apple’s Remarkable Growth in India: Riding the Wave of Premiumisation and Local Manufacturing

Apple’s Ascendancy in India: A New Era of Growth

India’s rapidly evolving smartphone market witnessed a groundbreaking milestone in 2024 as Apple emerged as a dominant force in the premium segment. The tech giant's exports of iPhones from India crossed an astounding Rs 1 lakh crore ($12 billion), marking a significant 40% growth compared to 2023. Backed by the Indian government’s production-linked incentive (PLI) scheme and the rising premiumisation trend, Apple’s footprint in India has grown exponentially, transforming the nation into a pivotal hub for its global operations.

A Surge in Local Manufacturing and Exports

Apple’s focus on local manufacturing has proven to be a game-changer. The company manufactured or assembled iPhones worth $14 billion in India during the fiscal year 2024 (FY24), with over $10 billion exported to international markets. This represents an impressive 46% growth in domestic production compared to the previous year.

India’s strategic importance in Apple’s supply chain has been bolstered by the PLI scheme, which incentivizes global companies to enhance their production capabilities within the country. This initiative not only supports India’s ambition to become a global manufacturing hub but also aligns seamlessly with Apple’s long-term goals of reducing dependence on other manufacturing bases.

Driving Employment and Empowering Women

Apple’s ecosystem has also had a transformative impact on job creation in India. Over the past four years, the company has generated 175,000 direct jobs, with a remarkable 72% of these positions filled by women. This emphasis on gender inclusivity highlights Apple’s commitment to social responsibility alongside its business objectives.

The Year of Premiumisation in India

2024 has been dubbed the “Year of Apple in India,” a period characterized by unprecedented growth in exports and record-breaking domestic sales. The premiumisation trend has played a pivotal role in this transformation, as Indian consumers increasingly gravitate toward high-end products. Readily available financing options have made premium smartphones more accessible, enabling Apple to capture a significant share of the aspirational Indian market.

Tarun Pathak, Research Director at Counterpoint Research, attributes Apple’s success to its aspirational brand appeal, robust consumer engagement, strategic retail expansion, and effective marketing campaigns. “Premiumisation in India, with readily available financing, boosts affordability for premium smartphones, benefiting Apple’s exclusive focus on this segment,” Pathak noted.

Aggressive Retail Expansion and Market Penetration

Apple’s aggressive retail strategy has further cemented its dominance. The company has expanded its physical and online retail presence across India, providing consumers with easier access to its premium products. This approach has been complemented by targeted marketing strategies aimed at tapping into the aspirations of India’s burgeoning middle and upper-middle-class segments.

Outlook for India’s Smartphone Market

India’s smartphone market is on an upward trajectory, with its value projected to exceed $50 billion by 2025. The retail average selling price (ASP) of smartphones in India is expected to cross the $300 mark for the first time, driven by the ongoing shift toward premium devices.

Apple has positioned itself as a leader in this transition, offering competitive options in the premium and ultra-premium categories. The strong demand for its Pro models, supported by local manufacturing and recent price adjustments, underscores the company’s strategic foresight and adaptability.

Apple’s Promising Future in India

As India’s economy grows and consumer preferences evolve, Apple’s strategic investments in manufacturing, retail, and marketing are set to yield sustained growth. The company’s success in 2024 has not only solidified its position in the Indian market but also underscored the potential of the country as a global hub for premium technology. With a bright future ahead, Apple is poised to continue its remarkable journey in India, shaping the premium smartphone landscape for years to come.