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Google Partners with Foxconn to Manufacture Pixel Phones in India

Tamil Nadu to Host Google’s Newest Manufacturing Plant for Pixel Phones

24 May 2024


Kunal Tyagi

India produced 3X more unicorns than China in 2022.png
  • Alphabet Inc., led by CEO Sundar Pichai, will manufacture its Pixel smartphones and potentially assemble drones through its subsidiary Wing in Tamil Nadu, collaborating with Foxconn Technology Group.

  • This initiative, supported by the Modi government's Production-Linked Incentive (PLI) scheme, is expected to boost the local economy by creating numerous jobs and enhancing Tamil Nadu's status as a leading electronics manufacturing hub.

  • Local manufacturing of Pixel smartphones aims to increase Google's market share in India by reducing import costs, with projections of a 30% annual growth in 2024, driven by competitive pricing and growing demand for premium smartphones.

In a significant development for India's burgeoning electronics manufacturing sector, Alphabet Inc., led by CEO Sundar Pichai, has announced plans to produce its flagship Pixel smartphones in Tamil Nadu. Chief Minister MK Stalin revealed this major initiative, highlighting not just smartphone production but also the potential assembly of drones by Alphabet’s subsidiary, Wing. This marks a substantial step in Google's strategy to expand its manufacturing footprint in India, leveraging the state’s established electronics manufacturing ecosystem.

The production facilities for Google's Pixel phones will be established in collaboration with Foxconn Technology Group, a Taiwanese contract manufacturer with a significant presence in Tamil Nadu. This partnership aligns with Google's broader ambitions to diversify its product manufacturing beyond smartphones to include drones and potentially other high-tech products. This initiative follows a recent visit by a Tamil Nadu delegation, including Industries Minister TRB Rajaa and Foxconn executives, to Google’s headquarters in Mountain View, California. The visit has evidently borne fruit, as Google now looks to set up a plant near Chennai.

Tamil Nadu is already a major hub for mobile phone manufacturing in India. Companies like Foxconn and Pegatron handle over 80% of Apple’s iPhone assembly in the region. The state’s robust infrastructure and skilled workforce make it an attractive destination for global tech giants. Google’s decision to manufacture its Pixel 8 smartphones in Tamil Nadu further cements the state’s reputation as a critical player in the global electronics supply chain. This move is also expected to contribute significantly to the local economy, creating numerous jobs and boosting regional development.

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Google’s foray into local manufacturing is part of a broader trend among tech giants to reduce their dependency on China. The Narendra Modi government’s Production-Linked Incentive (PLI) scheme has been instrumental in attracting such investments, offering incentives to boost domestic manufacturing. This policy shift is part of India’s strategy to position itself as a global manufacturing hub. As a result, the country has seen significant investments in electronics manufacturing, with nearly all mobile phones sold in India now being made domestically.

The local production of Pixel smartphones is expected to have a considerable impact on Google’s market share in India. According to Counterpoint Research, Google Pixel’s market share was a mere 0.04% during the March 2024 quarter. However, local manufacturing could drive growth by reducing import duties and lowering costs, making Pixel devices more competitive. Neil Shah, VP of Research at Counterpoint Research, anticipates a 30% annual growth for Google in 2024, driven by domestic manufacturing and the growing premium smartphone market in India.

In addition to smartphones, Alphabet’s subsidiary Wing LLC is set to commence drone assembly operations in Tamil Nadu. Wing currently provides drone delivery services in the US, Europe, and Australia. This expansion into India signifies Alphabet’s confidence in the country’s manufacturing capabilities and its potential as a strategic market. The Tamil Nadu delegation’s successful negotiations with Google underscore the state’s attractiveness for high-tech manufacturing investments, bolstering its status as a key player in India’s electronics manufacturing sector.

Overall, Google's decision to manufacture Pixel smartphones and drones in Tamil Nadu is a significant milestone in India's journey to becoming a global electronics manufacturing hub. This move not only benefits Google by allowing it to capitalize on the growing premium smartphone market in India but also reinforces Tamil Nadu’s position as a premier destination for high-tech manufacturing. With the state already leading in electronics exports and hosting major players like Apple, the addition of Google’s manufacturing operations promises to further enhance its economic landscape and technological prowess.

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