Apple maker Pegatron leases space near Chennai; to invest $150m in Tamil Nadu

By: |
January 21, 2021 12:20 AM

The company which has plans to pump in around $150 million into setting up contract mobile manufacturing facilities for Apple in Tamil Nadu, will use this site for assembling and warehousing purposes, according to sources.

Mail sent to Pegatron seeking comments on the development did not elicit any response till the time of going to the press.Mail sent to Pegatron seeking comments on the development did not elicit any response till the time of going to the press.

Apple’s contract manufacturer Pegatron Corporation has leased out half a million square feet space in an industrial park near Chennai developed by a city-based real estate company.

The company which has plans to pump in around $150 million into setting up contract mobile manufacturing facilities for Apple in Tamil Nadu, will use this site for assembling and warehousing purposes, according to sources.
Mail sent to Pegatron seeking comments on the development did not elicit any response till the time of going to the press.

Sources in the state government said that the company has leased out space for Apple-related operations in Tamil Nadu. According to sources privy to the development, Pegatron has leased half a million sq-ft at city-based realty firm Casa Grande’s Chennai industrial park.

Pegatron Corporation had in November 2020 approved a proposal to invest Rs 1,100 crore through its subsidiary Pegatron Technology India for its India plans. Sources said that the company will have one or two production facilities in India.

Pegatron will be the second contract manufacturer to assemble iPhones in Tamil Nadu after Foxconn, with its facility at Sriperumbudur near Chennai. Besides, Tata Electronics is reportedly planning to invest around $676 million at Hosur to manufacture mobile phone components.

Another iPhone maker Wistron had made headlines when a section of workers vandalised the Karnataka plant in December 2020 while protesting salary payments, causing severe damage resulting in halting of the operations. Sources said besides Tamil Nadu’s excellent port connectivity coupled with incentives offered by the state government, the Wistron episode would have played in the minds of the Pegatron management while choosing the state for building its manufacturing base for Apple.

Tamil Nadu is one of the largest hubs for mobile handsets and components. The state houses companies including Nokia, Samsung, Flex, Motorola, Foxconn, BYD among others.

The Tamil Nadu government has been taking bold steps to attract investors from electronics. It had launched a new electronics hardware manufacturing policy in 2020 and set a vision to transform Tamil Nadu into an innovative and a globally competitive electronics system design and manufacturing (ESDM) destination.

A JLL report recently cited that Chennai has topped the chart when it comes to leasing manufacturing space absorption with 36% of the transactions in 2020. India’s leased manufacturing space absorption was at 6.6 million sq ft in 2020, it said.

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