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Home Apple

Apple is said to be advancing plans to diversify its supply chain outside of China, according to a report

Apple is planning to shift production to India and Vietnam first

Sergio Richi by Sergio Richi
2 months ago
in Apple
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Apple is planning to shift production to India and Vietnam first

Source: logll.com

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The Chinese government has recently criticized Apple for restricting the use of AirDrop, a tool that protestors have often used to disseminate information critical of the government.

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In addition to supply chain effects, Apple’s relationship with China is now the subject of intense scrutiny.

India and Vietnam

According to the Wall Street Journal, Apple recently ‘accelerated’ plans to expand production outside of China. Primary iPhone assembly facilities have been repeatedly disrupted by China’s strict COVID-19 policy, leading to mass worker protests, most notably in November. 

Apple already has sizeable production bases in India and Vietnam, which are the report’s main locations of interest for expansion.

Foxconn facilities in China

Apple already produces some older iPhone models in facilities in India and Brazil. In Vietnam, facilities operated by Luxshare and Inventec, Apple’s primary assembly partners for AirPods and HomePods products, are located.

It is true that iPhone assembly at Foxconn facilities in China is a big deal. However, the magnitude is truly awe-inspiring when comparing it to other things. A reminder, Foxconn may lose Apple exclusive iPhone 15 Pro assembly due to scandal.

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Apple plans to relocate up to 40% of production

Building up the manufacturing infrastructure and labour force to accommodate the massive demands of the iPhone market will be a lengthy and complicated process. China’s cheap labour force and manufacturing infrastructure are difficult to find anywhere else, and will need to be built up gradually over time to accommodate iPhone production needs. Apple is expected to shift as much as 40% of iPhone production to other countries in the future.

According to the Journal, Apple wants its suppliers to do more NPI (new product introduction) work outside of China in order to build up advanced manufacturing ecosystems in countries like India. However, it may be difficult to accomplish. The report says that global economic weakness and Apple’s slowing hiring aren’t helping matters.

Apple plans to relocate up to 40% of production
Image Credit: The New York Times

China’s sudden and drastic geopolitical shifts circa 2016 caused Apple to temporarily lose its dependency. However, the firm was relatively unaffected by such geopolitics. Post-pandemic, it has been less successful at avoiding disruption. China continues to enforce strict zero-tolerance lockdowns to contain COVID-19 outbreaks. In the last two years, iPhone factories have been brought to a standstill several times thanks to these measures.

iPhone 14 Pro and iPhone 14 Pro Max

Apple warned early in November that assembly facility shutdowns in Zhengzhou, China would significantly reduce the availability of iPhone 14 Pro and iPhone 14 Pro Max this holiday season. Post-Christmas Day shipping times are now listed on Apple’s Online Store for new iPhone 14 Pro orders. It is estimated that this will result in billions of dollars in lost sales.

Apple’s relationship with China is becoming increasingly scrutinized due to supply chain effects. The company has recently been chastised for restricting the accessibility of AirDrop, a program that protesters frequently utilized to disseminate info critical of the Chinese government.

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Sergio Richi

Sergio Richi

Sergio Richi is the founder and proprietor of Logll.com. He specializes in writing about Cyber Security issues and topics related to this field. His work focuses on providing readers with comprehensive knowledge about the latest developments in the world of technology. He authors content on Business, Cars, Cool Gadgets, Laptops Reviews, Finances and Cryptocurrencies, as well as exploring developments in Information Security.

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