Apple’s India AirPods Plans Stumble Amid China’s Rare Earth Restrictions

Apple began producing AirPods in India earlier this year, but the process has encountered a hurdle due to China’s recent export restrictions on rare earth metals—critical components in manufacturing. These restrictions have disrupted the supply chain at the Foxconn Interconnect Technology (FIT) factory in Telangana. Despite the setback, reports suggest that the situation is under control, and AirPods production in India has not come to a complete halt.

Apple’s efforts to ramp up AirPods production in India have hit a snag due to a shortage of dysprosium—a rare earth metal critical for high-performance magnets used in the earbuds’ audio drivers. Dysprosium and neodymium are essential in producing the components that create sound in AirPods. According to a MoneyControl report, the supply disruption has directly impacted Foxconn’s facility in Telangana. “The issue continues for the industry and Apple in India,” a source familiar with the situation stated.

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The export restrictions, announced by China in April, have jeopardised Apple’s local manufacturing plans. As China is the dominant exporter of these metals, the curbs have created a significant supply chain bottleneck. In response, Foxconn has flagged the issue to multiple Indian government bodies, including the Ministry of Electronics and Information Technology (MeitY), Department for Promotion of Industry and Internal Trade (DPIIT), and even the Prime Minister’s Office (PMO). The next steps may hinge on how India and China handle the matter diplomatically.

Despite the challenges, AirPods production at the Telangana factory has not come to a complete standstill. Sources say that Apple and Foxconn had anticipated possible disruptions and “made arrangements accordingly” to cushion the impact. However, the situation has stretched the supply chain, adding pressure to an already complex manufacturing environment in India.

Adding to the woes, Foxconn recently repatriated over 300 Chinese engineers and technicians from its Indian facilities. This move has affected Apple’s local expansion efforts, leaving Taiwanese personnel to handle operations. These developments, combined with the rare-earth metal shortage, could benefit Chinese manufacturers like Luxshare and Goertek, who also make AirPods for Apple and may now see a boost in production demand.

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