Alphabet in talks to ramp up pixel production in India

Alphabet Inc has initiated talks with its local contract manufacturers—Dixon Technologies and Foxconn—to shift a part of the global production of Google Pixel smartphones to India from Vietnam, especially devices headed for the US.

The first round of talks on this took place about a fortnight ago, two industry executives said.

The shift is part of Alphabet’s strategy to derisk sourcing, with the US having threatened high tariffs on Vietnam, the Pixel’s primary production base.

The company has also shared plans with the contract manufacturers on localising some components in India, such as enclosures, chargers, fingerprint sensors and batteries, the executives said. Currently, most components for made-in-India Pixel phones are imported.

US President Donald Trump had announced a 46% tariff on Vietnam, compared with 26% on India. Trump paused the reciprocal tariffs by 90 days on April 9, although the 10% baseline tariff remained in place.

China is excluded from this 90-day deferment and faces the highest, 145%, tariff. India has fast-tracked talks with the US to try and conclude the first part of the agreement by September-October.

They want to more than double bilateral trade to $500 billion by 2030, from $190 billion. A trade pact would make it more attractive for American companies such as Alphabet and Apple to make products in India for export to the US.

Dixon and Foxconn have been making 43,000-45,000 Pixel smartphones a month in India, only for the local market, as Alphabet sought to reduce duty impact and make its smartphones competitive with Apple’s iPhone and Samsung’s premium Galaxy models. India levies 16.5% import duties in total on smartphones. Homegrown Dixon produces almost 65-70% of the Pixels produced in India, including the latest in the line, while Foxconn is more focused on older models. Foxconn was the first to start Pixel production in India last August, at its Tamil Nadu unit. Dixon began Pixel production at its Noida plant in December in alliance with Taiwan’s Compal Electronics.

Alphabet, Dixon and Foxconn didn’t respond to queries.

Alphabet had planned to make India a global production base for Pixel smartphones, but over two or three years. The executives cited earlier said the tariff regime by the US has forced the company to advance the timeline over global supply worries. Pixel smartphones are made in Vietnam and China, apart from India.

According to media reports, Google started Pixel production in Vietnam through Foxconn and Compal in 2023 to reduce risk and dependence on China. Almost half of all the premium models were manufactured in Vietnam last year.

One of the executives said Alphabet will progressively scale up exports from India to the US, and is also evaluating supplies to other countries. Pixel’s share of the Indian smartphone market is in the low single digits due to its superpremium pricing, although it has improved this in the past year after it decided to sell the devices offline as well.

In the US, Pixel rose to almost 14% market share after the launch of the latest models, while closing the last calendar year at around 7%, show Statcounter data.