Foxconn's Bharat FIH faces potential factory closure as orders dry up: Report

Former board members of Bharat FIH have cited a lack of clarity in the company's direction as the reason for their departures.

Bharat Foxconn International Holding (FIH) is considering closing its unit in Andhra Pradesh’s Siri City following a sharp drop in orders from key client Xiaomi, the Economic Times has reported, the latest trouble for the electronics manufacturer.

The Foxconn group company was already in trouble after the exit of three independent directors in the past three months. InterGlobe Aviation chairman Venkataramani Sumantran, Sify Technologies cofounder Ramaraj R and former IT and telecom secretary Aruna Sundararajan cited a lack of clarity in the company's direction as the reason for their departures.

Bharat FIH has struggled to diversify beyond Chinese smartphone maker Xiaomi, failing to compete effectively with rivals like home-grown Dixon Technologies, which has benefitted from the production-linked incentive (PLI) scheme, the report said.

Moneycontrol couldn’t verify the report independently.

The company’s inability to pivot quickly to other sectors exacerbated its woes, particularly as Xiaomi faces regulatory challenges in India, the report said.

Foxconn is expanding its India operations, notably in iPhone production, through other subsidiaries. However, Bharat FIH has not benefitted much from this expansion.

Bharat FIH has been hit by Xiaomi diversifying its manufacturing partners. It has promoted the firm to consolidate operations at its Sriperumbudur facility, which now focuses on diverse segments such as telecom equipment, EV components and displays.