Foxconn pulls out of another major factory deal, this time in India

iPhone assembler Foxconn is abandoning a $19.5 billion deal with a major Indian company to build a semiconductor factory in the country. According to reuters, The canceled Foxconn deal was part of a joint venture with large oil and metals corporation Vedanta.

Foxconn gave a vague explanation as to why it scrapped its plans to build a semiconductor facility in the country. “Foxconn has decided not to proceed with the joint venture with Vedanta,” a company statement said. reuters, Foxconn says the deal was ended by mutual consent. The company said in a statement that Vedanta “has roped in other partners” to set up the foundry.

The Foxconn–Vedanta dispute is a blow to the economic development efforts of Indian Prime Minister Narendra Modi for the country and his home state of Gujarat, where the factory was planned. Foxconn is still operating other facilities in the country, including one in Sriperumbudur, where it is manufacturing the iPhone 14 models.

Device makers such as Apple are working with more supply partners to diversify manufacturing outside mainland China as political and economic uncertainties mount. India, in particular, is a market that Apple is trying to break into; The company opened its first Indian retail stores in Mumbai and New Delhi in April.

Foxconn’s Vedanta deal is the latest deal to go south. As Wisconsin learned the hard way, injecting $4 billion into Foxconn isn’t enough to get the company to build a factory. And it’s currently being sued in the US by ailing EV automaker Lordstown Motors for allegedly “fraudulent and willful and persistent failure to meet its commercial and financial commitments.”