Recently, global chip giant Intel announced to acquire a stake in Dongguan Luxshare Technology Co., Ltd. (Referred to as “Dongguan Luxshare Technology”), a subsidiary of Luxshare Precision.

According to a report from WeChat account DRAMeXchange citing sources, it has shown that on June 12, Dongguan Luxshare Technology’s registered capital increased from around CNY 571 million to around CNY 589 million, an increase of about 3.1%, with Intel (China) Co., Ltd. as a new shareholder. It is reported that Intel China has invested CNY 17.662 million in the company.

Luxshare Precision primarily provides products for industries including consumer electronics, communications and data centers, automotive electronics, and medical sectors. As its subsidiary, Dongguan Luxshare Technology specializes in the production of communications equipment such as base station antennas, filters, and RRU, as well as interconnect products like connectors, cables, optical modules, and AOC, which have been widely used in applications like wireless communication base stations, data centers, servers, switches, and routers.

As a global leader in the semiconductor industry and computing innovation, Intel achieved a revenue of USD 63 billion in 2022. In the computing sector, statistics showed that in 4Q23, Intel shipped as many as 50 million PC processors, representing a year-on-year increase of 3% and a market share of 78%.

In the semiconductor field, Intel is developing foundry business at full throttle. According to its official website, to meet the growing global semiconductor demand and promote its IDM 2.0 strategy, Intel is ramping up its production capacity by investing about USD 20 billion in building fabs in Arizona and New Mexico, and over USD 20 billion in Ohio for the acquisition of Tower Semiconductor. It plans to pour up to EUR 80 billion to the EU in the entire semiconductor value chain over the next decade.

As per another report from the Securities Times, a source revealed that this cooperation does not involve the consumer electronics field but mainly the communications field. That means future products of Luxshare Precision in this field will be deeply integrated with Intel chips. For instance, both parties will engage in deep collaboration from the product development stage.

Furthermore, industry sources cited by the same report further explained that the transmission rate and bandwidth of communication-related products are fundamentally related to the chips they use. Therefore, Intel’s investment in Luxshare Precision’s subsidiary will enhance the competitiveness of Luxshare Precision’s products in the communications and data center sectors, contributing to the rapid development of this business.

As stated in Luxshare Precision’s annual report, the communications industry embraced new development opportunities amidst the wave of global digital transformation in 2023. Copper connectivity, optical connectivity, thermal modules, servers, and communication RF fields that Luxshare’s business has involved also saw significant growth, which became important drivers for the industry development.

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• [News] Luxshare Reportedly Enters NVIDIA’s Chain, Eyeing at AI Chip Business

(Photo credit: Intel)

According to a report from Economic Daily News, Luxshare, a crucial player in the Chinese Apple supply chain, is said to be entering NVIDIA’s supply chain for the GB200, as it has announced the development of various components tailored for NVIDIA’s GB200 AI servers.

These components encompass connector, power-related items, and cooling products. The sources cited by the same report have noted that Luxshare’s focus areas align closely with Taiwanese expertise, setting the stage for another direct showdown with Taiwanese manufacturers.

Luxshare, previously not prominent in the server domain, has now reportedly made its move into NVIDIA’s top-tier AI products, attracting market attention. Especially given Luxshare’s swift entry into the iPhone supply chain previously, aggressively competing for orders with Taiwanese Apple suppliers.

As per the same report, Luxshare has revealed in its investor conference records that it has developed solutions corresponding to the NVIDIA GB200 AI server architecture, including products for electrical connection, optical connection, power management, and cooling. The company is reportedly said to be expected to offer solutions priced at approximately CNY 2.09 million and anticipates that the total market size will reach hundreds of billions of CNY.

If Luxshare adopts a similar strategy of leveraging its latecomer advantage in entering the NVIDIA AI supply chain, it will undoubtedly encounter intense competition.

Industry sources cited by the report also point out that Luxshare’s claim to supply components for NVIDIA’s GB200 is in areas where Taiwanese suppliers excel.

For instance, while connector is Luxshare’s core business, Taiwanese firms like JPC Connectivity and Lintes Tech also serve as suppliers of connectors for NVIDIA’s GB200 AI servers. They are poised to compete directly with Luxshare in the future.

In terms of power supply, Delta Electronics leverages its expertise in integrating power, cooling, and passive components to provide a comprehensive range of AI power integration solutions, from the grid to the chip. They cater to orders for power supplies for NVIDIA’s Blackwell architecture series B100, B200, and GB200 servers, and will also compete with Luxshare in the future.

When it comes to thermal management, Asia Vital Components and Auras Technology are currently the anticipated players in the market, and they are also poised to compete with Luxshare.

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• [News] Luxshare Acquires Leadership of Pegatron’s Kunshan Plant, Challenging Foxconn’s Dominance on iPhone Assembly?

(Photo credit: Luxshare)

Earlier, Reuters reported that contract manufacturer Pegatron was in talks to sell its sole iPhone assembly plant in India to Tata Group, and discussions were in advanced stages. Regarding this matter, Pegatron told CNA reporters that this report was speculative and lacked evidence, declining to comment further.

According to a Reuters report on April 8, Pegatron was said to be considering selling its iPhone assembly plant located in Chennai, a major city in southern India, to Tata Group, India’s largest private enterprise. The negotiations were rumored to conclude within six months. If an agreement is reached, the two parties will establish a joint venture, with Tata Group holding a 65% stake to operate the plant, while Pegatron will retain a 35% stake and provide technical support.

Sources cited by Reuters also mentioned that Pegatron is building another iPhone assembly plant in the Chennai area, and discussions with Tata include acquiring control of this new facility. The negotiations between Tata and Pegatron are expected to conclude within six months, after which all Pegatron India plant employees will transition to the joint venture.

Amid rising geopolitical risks, tech giants are diversifying production away from China. Pegatron reduced its stake in its Kunshan plant to 37.5% in December, with Chinese Luxshare now leading. However, Pegatron emphasizes it won’t withdraw from China and plans to establish new facilities this year.

In recent years, Pegatron has been consistently expanding its global footprint, with expansions ongoing in Taiwan, Mexico, Indonesia, India, Vietnam, and other locations.

Currently, approximately 10% of Apple’s iPhone production capacity in India comes from Pegatron, with the vast majority of capacity originating from Foxconn’s iPhone assembly plant located in Karnataka.

Furthermore, Foxconn has the highest share in Apple’s current new iPhone assembly. Among the four iPhone 15 series models, only certain models like iPhone15 and iPhone15 plus are produced by Tata Group in India.

In January, Pegatron announced a USD 12 million investment to form a Malaysian subsidiary for consumer electronics. It’s also expanding its Mexican plant capacity, investing USD 75 million to boost its electric vehicle business.

(Photo credit: Apple)

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The battle for Apple’s iPhone manufacturing orders has entered a new phase this year. According to a report from Economic Daily News, while Foxconn still appears poised to dominate, with expectations to assemble over half of the iPhone 16 series, maintaining its lead; Luxshare, a key supplier in the supply chain, has swiftly risen to challenge, surpassing Pegatron to become the second-largest iPhone manufacturer.

With Luxshare’s share continuing to rise this year and the emergence of India’s Tata Group as a new contender, it is expected that the competition for iPhone manufacturing orders this year will be characterized by one leader, two strong contenders, and one new challenger.

In 2023, Apple launched the iPhone 15 series, with over 60% of the assembly orders handled by Foxconn, while Luxshare’s order share continued to rise, surpassing Pegatron last year to become the second-largest iPhone assembler. With Pegatron transferring the lead of its Kunshan factory in China to Luxshare at the end of last year, Luxshare’s order share is expected to continue increasing.

To retain its crucial Chinese market and further reduce costs, per a report from Economic Daily News, Apple has allowed Luxshare to continuously increase its share of Apple orders in recent years. Luxshare’s assembly products is anticipated to cover iPhone, Apple Watch, and the recently launched Vision Pro—a headset exclusively manufactured by Luxshare. Luxshare has then become a prominent supplier within the Apple supply chain in China.

The report further indicated that this year’s iPhone 16 series orders are expected to be predominantly secured by Foxconn Group, accounting for over 50% of the share. Luxshare ranks second, while Pegatron’s share is expected to decrease to third place. The proportion of Tata Group’s new device orders remains to be seen.

As Luxshare continues to expand its presence in the iPhone assembly domain, Tata Group, after taking over Wistron’s iPhone assembly plant in India, continues to improve overall production efficiency. By leveraging the advantages of being a local manufacturer in India, Luxshare’s presence in the iPhone assembly supply chain is expected to continue to rise in the future.

The report also mentioned that Tata Group is in negotiations with Pegatron to jointly establish an iPhone assembly plant in Hosur city, Tamil Nadu, in southern India. This would be marked as Tata Group’s first venture into this business through a joint venture.

Reportedly, it is suggested that Tata will hold the majority stake in the joint venture, while Pegatron will provide technical and engineering support for the Hosur city plant to help accelerate the construction process. Pegatron declined to comment on this matter.

In the past, Wistron Group’s factory in Karnataka, India, primarily produced older models of the iPhone. This factory has been sold to Tata Group. Market observers note that if the joint venture between Pegatron and Tata Group in Hosur city materializes, it will help Tata Group to expedite its entry into the production of new iPhone models.

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• [News] Tata Group Plans to Build New iPhone Assembly Plant in India, Aligning with Apple’s Localization Strategy for the Supply Chain
• [News] Luxshare Acquires Leadership of Pegatron’s Kunshan Plant, Challenging Foxconn’s Dominance on iPhone Assembly?

(Photo credit: Apple)

Chinese iPhone assembly contractor Luxshare Precision is set to officially acquire the controlling stake of Pegaglobe (Kunshan), the iPhone assembly plant under Pegatron. This series of acquisitions will provide Luxshare with a stronger competitive advantage against Foxconn. Concurrently, Luxshare is reinforcing its component layout to enhance its capability to expand iPhone orders.

Following the acquisition of Wistron’s Jiangsu and Kunshan plant, Luxshare has now secured the controlling stake of Pegaglobe (Kunshan), a subsidiary of Pegatron. This marks another acquisition of China’s plants involved in manufacturing iPhone for Taiwanese companies.

According to UDN citing from industry insiders,  Luxshare’s acquisition of Pegaglobe (Kunshan) is likely to have received Apple’s approval. Luxshare has consecutively broken the pattern of iPhones being solely manufactured by Taiwanese companies, suggesting that Luxshare has the opportunity to reshape the landscape of iPhone manufacturing in the future.

Having acquired iPhone manufacturing plants in China from Wistron and Pegatron, Luxshare not only gains more market share in manufacturing but also expands its presence in the upstream iPhone component supply chain. This ongoing integration of upstream components enhances Luxshare’s capability to secure more iPhone orders.

In the past three years, Luxshare has been consistently acquiring iPhone-related supply chain entities. In July 2020, Luxshare’s subsidiary, Lizhen Precision (Jiangsu), acquired Wistron Investment (Jiangsu) and Wistron InfoComm Manufacturing (Kunshan) for RMB 3.3 billion (approximately USD 467 million), marking the beginning of Luxshare’s acquisition of plants involved in iPhones assembly for Taiwanese companies.

Recently, Luxshare finalized an agreement with the global provider of connectivity and power solutions – Qorvo. Luxshare will acquire Qorvo’s testing and packaging facilities in Beijing and Dezhou, with the transaction expected to be completed in the first half of next year. This move is seen as Luxshare’s effort to build a more comprehensive iPhone component supply chain.

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• [News] Apple Supplier Qorvo Sells Chinese Test and Packaging Plant to Luxshare
• [News] Tata Group Plans to Build New iPhone Assembly Plant in India, Aligning with Apple’s Localization Strategy for the Supply Chain

(Photo credit: Luxshare)