China pounces after hack on Apple’s Indian supplier Tata Electronics

The recent cyber breach at Indian Apple supplier Tata Electronics has become propaganda gold for Beijing, as leaders vie to keep international companies locked into China‘s supply chains.

“Something like this would never happen in China,” said Ma Shouhua, an iPhone repair specialist in China’s biggest electronics marketplace, Huaqiangbei.

Ma recently posted a viral video outlining the purported specifications of Apple’s soon-to-be-released iPhone 18 Pro models that were part of the materials leaked after the breach.

Tata Electronics confirmed a “cybersecurity incident” to CNBC but said it “had no impact on our operations across businesses.” The company did not say if any materials or data were stolen.

Reuters reported in June that hacking group World Leaks claimed responsibility for the attack and that stolen data included parts lists, suppliers and photos of Apple’s unreleased iPhone 18 Pro.

Apple declined to comment on the leak or its supply chain plans.

With geopolitical tensions rising, dependence on China has become riskier for U.S. companies, leading Apple and other companies to make greater efforts to diversify. Last year, Apple produced its top devices — the iPhone 17 series — in India for the first time.

The competition with India for iPhone production and other manufacturing has alarmed Chinese authorities.

The Communist Party’s Global Times newspaper warned in July of “systemic weaknesses in ‘Made in India'” and argued that replicating supply chains in other countries is “no easy task.”

China is competing with lower-cost countries to retain all supply chains for jobs and leverage over its trading partners.

The U.S. Chamber of Commerce wrote in a May report with Rhodium Group that China is “using regulations and economic coercion” to reinforce its control over critical supply chains.

“It has tightened controls on critical minerals and processing technologies, extended restrictions to downstream products through extraterritorial rules, and introduced new legal instruments that raise the cost for firms and governments seeking to diversify away from China,” the report stated.

The Tata Electronics leak might not be serious enough to change Apple’s course on its supply chain, and appears to be less of a risk than originally feared.

In Shenzhen-based Huaqiangbei, where old iPhones are bought and sold, the technicians are famous for their ability to refurbish, repair, and rebuild devices.

On a recent visit, CNBC spoke to several technicians who insisted that recreating an iPhone 18 Pro is almost impossible despite widespread discussion on Chinese social media to the contrary.

“You can’t really make anything from those drawings. At most, you could make phone cases,” seller Guo Youliang said.

Though highly skilled, the technicians in Huaqiangbei said that they cannot get key parts of an iPhone — mainly the chips or the software.

“They might look like an iPhone, but the insides are different,” iPhone repair specialist Wang Shun said while fixing a model at his stall in the market.

One example is the $29 “17 Pro Mini.” Also referred to as the “Baby iPhone,” the copycat resembles an iPhone 17 Pro down to its exclusive cosmic orange color. Yet it is powered by Android.

Apple stopped producing mini-sized versions after the iPhone 13 Mini.

The iPhone 18 Pro models are widely expected to be released this September.