Daybreak - Can Tata Build Your Next iPhone?

Episode Date: June 22, 2025

Tata Electronics is assembling iPhones in Karnataka, aiming to become a key player in Apple’s global supply chain. In this episode, we look at how the company is scaling by adding factories, hiring thousands of workers, and investing heavily in automation. But it’s also facing high attrition, rising debt, and pressure to meet Apple’s strict standards. Can Tata turn its manufacturing push into a long-term win?Tune in.Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

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Every single day, in a sweltering industrial corner of Karnataka, thousands of women are soldering, assembling, inspecting iPhones. Or after hour, shift after shift, the air is thick with pollution, trucks are rumbling and you can hear the dull heart. of the cooling fans. And against a sun-bleached wall, a small group of young women in blue uniforms are wiping the sweat of their faces.

One of them tells my colleague, the Ken reporter Shrish Tihachar, I've been here for months. Most of the batchmates I trained with have already left. This is the Narasapura industrial area, home to Tata Electronics' giant factory that now assembles parts of Apple's iPhone's ice. phone. The factory did not exist in its current form just a year ago. It was once run by a Taiwanese

supplier and now it is Tata's bold move into one of the most demanding supply chains on the planet. In the US, Apple and lawmakers have been arguing over where an iPhone's heart should be made. In India, Tata is trying to prove it can manufacture that heart at scale and without going to be. broke. But the road is steep, the money is bleeding and targets are ruthless. And the question still remains. Can Tata really build an iPhone empire in India? Or is this whole thing just a very expensive gamble? Welcome to Daybreak, a business podcast from the Ken. I'm your host, Nekh Dha Sharma, and I don't chase the news cycle. Instead, every day of the week, my colleague Rahil Filippos and I will come to you with one business story that is worth understanding.

and worth your time. Today is Monday, the 23rd of June. So, why is Tata doing this? The simple answer is Apple wants out of China, or at least it wants to become less dependent on it. Between trade wars and tariffs, India has become a natural backup plan. And for Tata, it is an opportunity to make a statement.

They bought Wistron's plan for $125 million. They built a second factory, and they also grabbed a majority. stake in Pegatron India. Next thing we know, their headcount ballooned from 13,000 to almost 20,000 in just eight months. But that kind of growth

comes with a price tag. In the financial year 2024, Tata's total assets shot up from nearly 6,000 crore rupees to 20,000 crore rupees, and revenues jumped nine times to more than 3,500

crores. And yet, they posted a net loss of 825 crore rupees. Because to hit Apple volumes, you need more than people and land. You need automation, you need machinery, training, systems, you need cash. Tata raised 9,000 crore rupees in fresh debt. Then Tata's sons injected another 2,100 crore rupees in equity through a rights issue. Some of this was not even intentional. It just so happened that when U.S.-China tensions flared up, Tata was already deep in this game. But by financial year 2025,

Apple had made $22 billion worth of iPhones in India. Tata is now responsible for 30% of that. The rest is mostly Foxconn. And it's not just about output. It's about doing it at Apple's speed. Inventry, at Tata, exploded from 120 crore rupees to over 3,600 crore rupees. and their receivables went up to over 5,000 crores from 282 crores. And that is the cost of trying to meet up with Apple's giant orders on tight timelines.

But on the bright side, Tata did turn a corner on operating income. It saw a positive abeta of over 250 crore rupees after a loss to previous year. Still, the challenge is endless upgrades. Each new iPhone model requires retooling entire lines. Tata has to buy capital equipment, recalibrate systems and retrain workers every single year. As one executive told us, Tata ended up being the only one to choose this trade-off. And they've barely been at it for a year. More on this and the Narsapura plant in the next segment.

Stay tuned. Now, let us zoom in into the factory itself. Inside Narasapura, things are organized but intense. Each worker is trained for two to three weeks before they even touch an iPhone part. On the floor, tasks are laser-focused. One section, one step over and over and over again. And why? Because they want to protect Apple's trade secrets.

No single worker sees the full process. It is compartmentalized by design. One worker told the Ken reporter Shristiariari, between 100 to 200 units per day, she was talking about her portion of the multi-layer circuit board. Shifts run 24-7, 3 blocks, 6 a.m. to 2 p.m. to 10 p.m. and 10 p.m. to 6am. Basically, the factory does not sleep and it cannot afford to. Apple demands precision. Each iPhone goes through 600 quality checkpoints before it is shipped. A single defect can blow up the whole batch and maybe the supplier relationship along with it.

And this is why Tata has invested in automation equipment from companies like Delta Electronics. One executive said that rejection rates once over 10 to 12% under Wistron are now around 2%. And that is a big deal. But keeping the factory staffed is a full-time job on its own. Attrition is brutal. Around 200 workers quit each day. And the reasons vary. Better pay, easier jobs elsewhere, and just the grind.

But the recruiters work just as fast. Each day, around 300 new hires show up. One recruiter told us that there are 15 others like him in the area. Each one brings in about 20 people a day. It is practically an economy of its own. The factory also faces internal huddles. Tata took over from different. companies, each with its own systems, and bringing all of that under one roof is a Herculean

task. And then there is the long game. Tata wants more than iPhones. If they can move into making components, not just assembling, they could boost profits. And a new 23,000-crow-ru-ru- government scheme for electronics could actually help if Tata can qualify. They are even talking to Xiaomi and Oppo. But breaking even, that is at least five to seven years away. So, until then, the gates of Narsapura keep opening and closing. Another shift ends, another begins, and Tata keeps chasing something much bigger than just a contract.

Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offering. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Desubscribe, head to the ken.com and click on the red subscribe button on top of the Ken website. Today's episode was hosted by Snigda Sharma and edited by Rajiv Sien.