Google to Shift Production to India from Vietnam; Here’s Why

According to the news reports, Alphabet Inc., the parent company of Google, is realigning its manufacturing operations to navigate shifting global trade dynamics. Central to this shift is the decision to relocate a significant portion of Google Pixel smartphone production from Vietnam to India. This move is driven by ongoing tariff pressures, especially from the United States, and a broader ambition to diversify supply chains beyond China and Vietnam.

Vietnam’s Growing Trade Risk Sparks Urgency

Vietnam, which has been a cornerstone of Google’s Pixel assembly, is facing the threat of steep US tariffs, potentially as high as 46%. By contrast, Indian exports to the US could attract a relatively lower tariff of 26%. While these proposed tariffs are currently on a 90-day hold, companies are pre-emptively adapting to avoid disruptions.

This has made Vietnam less viable for export-oriented production in the short term, propelling Google to explore safer and more cost-efficient alternatives.

India Gains Ground in Google’s Pixel Plans

India is fast emerging as a strategic production hub for Google. In 2023, the company began assembling Pixel devices locally with help from Foxconn and Compal. This momentum has continued into 2024, with Dixon Technologies and Foxconn now producing around 43,000 to 45,000 units monthly at their Tamil Nadu and Noida facilities.

While the current output primarily caters to the domestic market, discussions are underway to scale production for exports, particularly to the US.

Read More: Dixon Hits 3-Month High, Rebounds 36% from April Low

Local Sourcing and Component Independence

As part of this transition, Google is exploring the localisation of several key components — including chargers, batteries, enclosures, and fingerprint sensors — which are still being imported. This shift towards domestic sourcing would not only lower production costs but also align with the Indian government’s ‘Make in India’ initiative.

Drawing Parallels with Apple’s India Strategy

Google’s approach mirrors Apple’s roadmap in India, which involves incrementally shifting high-end device assembly to local units. By doing so, tech giants reduce their exposure to geopolitical risks while also gaining from government incentives and a rapidly improving electronics manufacturing ecosystem.

In August 2024, the Pixel 8 began rolling out from Wowtek Technology India, a subsidiary of Bharat FIH (Foxconn), from a Tamil Nadu-based plant, signalling Google’s deeper manufacturing commitment to the region.

Conclusion

Looking forward, Google appears set to make India a major node in its global Pixel supply chain. Industry reports indicate Alphabet is preparing to expand export-oriented production from India and is also considering shipments to new international markets.

The strategy positions India as a key beneficiary of trade realignments, while giving Google a more agile and cost-effective manufacturing base amid global uncertainties.

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