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Yuzhan Technology Leases Warehouse Space in Chennai Amid Surge in Apple iPhone Exports from India

Chennai Warehouse Space Leased by Yuzhan Technology Amid Rise in Apple iPhone Exports from India

Yuzhan Technology Leases Warehouse Space in Chennai Amid Surge in Apple iPhone Exports from India -  Supply Chain Tribe by Celerity

Yuzhan Technology, a part of Taiwan's Foxconn Group, has leased approximately 550,000 square feet of warehousing space at ESR Industrial Park in Oragadam, on the outskirts of Chennai. This move comes in response to a significant increase in exports of Apple iPhones from India.

The new warehouse, one of the largest for Foxconn in India, underscores the company's commitment to scaling up its operations to meet the growing demand for Apple products manufactured in India. The facility will help Foxconn optimize its supply chain and logistical capabilities to support its expanding export activities.

Foxconn will pay a monthly rental of INR 26-28 per square foot for a period of 10 years. The company has acquired 320,000 square feet of dry storage space and signed a letter of intent for the remaining 230,000 square feet, as the building is still under construction.

ESR Industrial Park, spanning 100 acres, offers potential for 2.2 million square feet of leasable space for warehousing and industrial use. It currently houses clients like Cubic, Siemens, A2MAC1, New Century Sofa, and Checkpoint.

Chennai has seen a rise in its share of logistical and industrial warehouse leasing activity, driven by demand from third-party logistics players and manufacturing. It remains the second-largest logistics market in India after Mumbai, with 19% market share, and second after Pune in industrial warehousing space, holding 24% of the market.

In 2023, Chennai witnessed 10.78 million square feet of overall leasing activity, with warehouse leasing activity nearly doubling compared to 2022. The Oragadam submarket, a key industrial corridor for electronics and automobile manufacturing, witnessed a five-fold increase in gross leasing compared to 2022.

Foxconn, known for being the world's largest contract electronics manufacturer, has been expanding its manufacturing facilities in India, particularly in the southern region. Apart from its existing iPhone assembly unit in Tamil Nadu, the company aims to double its workforce and investment in India by 2024, tapping into the country's favourable business environment and the growing demand for electronics in the region.

India exported smartphones worth around USD 15 billion in 2023-24, with iPhones contributing 65%, or about USD 10 billion, up from USD 5 billion in the previous year. The government expects a quarter of all iPhones to be made in India by 2028, with some accessories like AirPods also being assembled in the country.

The demand for industrial and logistics space in Chennai continues to grow, driven by sectors like electronics manufacturing, automobiles, and FMCG. Major industrial parks like Oragadam are attracting investments from global companies looking to leverage India's manufacturing potential.