U.S. tech giant Apple has told its suppliers that it wants to expand contract manufacturing beyond China and sees Vietnam and India as potential new production hubs.
Considering supply chain issues primarily due to Beijing’s stringent anti-Covid-19 policies and related extended lockdowns, Wall Street Journal report.
Apple’s heavy reliance on China is also seen as a potential risk to the company due to the unpredictable behavior of Beijing’s authoritarian government and ongoing political conflict with U.S. leadership, the report cited analysts as saying.
Currently, more than 90% of Apple products, such as iPhone, iPad, MacBook laptops, electronic products and accessories, are manufactured in China by contractors such as Foxconn, Pegatron, Wistron, Goertek and Luxshare Precision. But production from Vietnam and India has grown in China. The report said that the recent past.
China’s strict lockdown clogs supply chains
Apple has been considering geographic expansion plans, but the pandemic has halted any immediate changes. However, it added that the latest round of strict lockdowns in Shanghai has once again demonstrated the need for diversification.
In addition, Apple began considering shifting some production this year after Beijing did not criticize Russia for invading Ukraine.
Any move by Apple to shift production from China could be a model for other Western companies that are also considering reducing their reliance on Chinese manufacturing or critical materials, the report noted.
difficult to compete with China
However, analysts said it would be difficult for any other country to compete with China as an electronics production hub, as only Chinese facilities can currently meet Apple’s massive order demands.
Also, finding cheap, qualified labor elsewhere remains difficult, so the transition to alternative production hubs such as Vietnam or India is likely to be slow and gradual. For Apple, this means that the main production of new products will initially be located outside of China.
Foxconn is Apple’s largest contract manufacturer U.S. tech giant Apple has told its suppliers that it wants to expand contract manufacturing beyond China and sees Vietnam and India as potential new production hubs. According to The Wall Street Journal, the consideration is largely due to supply chain issues stemming from Beijing’s strict anti-Covid-19 policies and related issues such as extended lockdowns. Apple’s heavy reliance on China is also seen as a potential risk for the company due to the unpredictable behavior of Beijing’s authoritarian government and the…
U.S. tech giant Apple has told its suppliers that it wants to expand contract manufacturing beyond China and sees Vietnam and India as potential new production hubs.
Considering supply chain issues primarily due to Beijing’s stringent anti-Covid-19 policies and related extended lockdowns, Wall Street Journal report.
Apple’s heavy reliance on China is also seen as a potential risk to the company due to the unpredictable behavior of Beijing’s authoritarian government and ongoing political conflict with U.S. leadership, the report cited analysts as saying.
Currently, more than 90% of Apple products, such as iPhone, iPad, MacBook laptops, electronic products and accessories, are manufactured in China by contractors such as Foxconn, Pegatron, Wistron, Goertek and Luxshare Precision. But production from Vietnam and India has grown in China. The report said that the recent past.
China’s strict lockdown clogs supply chains
Apple has been considering geographic expansion plans, but the pandemic has halted any immediate changes. However, it added that the latest round of strict lockdowns in Shanghai has once again demonstrated the need for diversification.
In addition, Apple began considering shifting some production this year after Beijing did not criticize Russia for invading Ukraine.
Any move by Apple to shift production from China could be a model for other Western companies that are also considering reducing their reliance on Chinese manufacturing or critical materials, the report noted.
difficult to compete with China
However, analysts said it would be difficult for any other country to compete with China as an electronics production hub, as only Chinese facilities can currently meet Apple’s massive order demands.
Also, finding cheap, qualified labor elsewhere remains difficult, so the transition to alternative production hubs such as Vietnam or India is likely to be slow and gradual. For Apple, this means that the main production of new products will initially be located outside of China.
