After Foxconn and Pegatron, China's Luxshare Precision Industry Co will be the third major contract manufacturer of Apple Inc to set up shop in Tamil Nadu. It plans to reopen the now-defunct Motorola factory in Sriperumbudur, an emerging electronics hub just 50 kilometres from Chennai.

Luxshare's entry into India will be a significant boost for Apple, as the former is involved in the production of wearables and hearables such as the Apple Watch and Apple Airpods for the Cupertino-based global electronics giant. According to sources, the Chinese firm is expected to begin production within the next three months after receiving clearance in January from the Union Government, which had kept its application pending for nearly two years due to a variety of reasons.

Following the Covid-19 pandemic, Apple plans to relocate a significant portion of its production outside of China. The Luxshare approval will allow Apple to manufacture accessories for both the domestic and international markets.

Luxshare plans to invest Rs 745 crore in the plant, which has been dormant for several years, to provide jobs for 4,000 people, according to sources in the know.

“Luxshare will manufacture electronic components and wearables in Sriperumbudur. The company has also applied for the Union Government’s Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS),” a source said on the condition of anonymity.

SPECS aims to strengthen the country's electronics manufacturing ecosystem by offering a 25% financial incentive on capital expenditure for the identified list of electronic goods that comprise the downstream value chain of electronic products.

Another informed source told DH that the Tamil Nadu government has also granted Luxshare the necessary approvals to begin component manufacturing. Luxshare did not respond to an email requesting comment.