Japanese iPhone component supplier eyes supply chain shift towards India

The company has leased a plant in Chennai's OneHub Industrial Park to package and ship ceramic capacitors in the fiscal year starting April 2026

Kyoto-based iPhone component manufacturer Murata Manufacturing Co. is contemplating moving a part of its production capacity to India, news agency Bloomberg reported on Wednesday.

A man tests an iPhone 16 in an Apple store. Apple has been diversifying production beyond China, most recently beginning production of its AirPods wireless earphones on a trial basis in India.(AFP)

According to Murata President Norio Nakajima, the maker of multilayer ceramic capacitors sees growing demand in India and is running simulations to determine what it would take to increase its investments in the country. The decision also reflects a global realignment of supply chains towards India, the report said.

“We’ve been making our newest capacitors mostly in Japan, but customers are asking us to manufacture more overseas due partly to business continuity planning purposes,” Nakajima said.

With promises of support from the NDA government at the Centre, the company has leased a plant in Chennai's OneHub Industrial Park as part of its plans to package and ship ceramic capacitors in the fiscal year starting April 2026. The agreement, worth $6.6 million, will be used to forecast long-term demand in India before the company commits a larger investment to build a factory to expand its production process, said the company's president.

“It’s too early for us to build an integrated production facility in India, because the infrastructure for inputs such as power hasn’t reached the level we need, but we wanted to move early to build some capacity there as our customers shift production,” Nakajima said.

“There’s growing consumer demand for electronics in the country, and we also should be ready to respond quickly when India introduces new incentives to encourage domestic manufacturing,” he added.

Concerned by Trump's tariffs

US President Donald Trump's threat to impose reciprocal tariffs on his country's trading partners has prompted internal discussions at the company, which is concerned over the broader and indirect damage that tariffs might cause. A surge in prices in a wide range of consumer goods would ultimately hurt orders for capacitors, Nakajima said.

The company has no current plans to build manufacturing facilities in the US even as it prepares its production capacities in India. The decision is because its capacitors are built into products assembled mainly in Asia before shipment to the US.

Murata is the global leader in the supply of capacitors, which regulate the delivery of power to electric components. The company's capacitors are used in almost all electronics, from Apple and Samsung smartphones to Nvidia servers and Sony's game consoles.

The company makes almost 60% of its multilayer ceramic capacitors (MLCCs) in Japan. But, Nakajima said it will likely fall closer to 50% in the coming years.