Apple is expanding its production capacity in India and Southeast Asian countries for iPhones, iPads, Macs and other Apple products. The Nikkei Shimbun analyzed that under Biden‘s tenure, Apple hopes that tensions between the U.S. and China will ease, but is still accelerating its “withdrawal from the Chinese supply chain.
According to the Nikkei Shimbun, sources said production of iPads will begin in Vietnam as early as the middle of this year, meaning Apple will make a large number of tablets outside of China for the first Time, the sources said, while Apple is also accelerating production of tablets in India and plans to begin production of the latest iPhone 12 series phones in India this season.
Apple is mobilizing its Vietnamese suppliers to expand production capacity for the latest version of its HomePod mini, which has been made in Vietnam since the device was launched last year. Apple meanwhile is raising local production in Vietnam of its audio-related products, including various AirPods series, the source said.
Another person familiar with the matter said Apple has shifted some of its Mac mini production to Malaysia, and Apple also plans to move some MacBook production to Vietnam this year.
A supply chain manager explained that Apple and many other technology companies want to produce outside of China, and even with a new president in the U.S., that won’t slow down the pace of shifting supply chains. Such a situation would have been difficult to imagine 2 years ago.
Apple suppliers are also working hard to meet Apple’s demand for a diverse production base. Supplier Foxconn, officially under the name of Hon Hai Precision Industry, established a subsidiary in Vietnam with a capital injection of US$270 million at the end of last year. In addition, Nikkei has learned that Lixin Precision is also expanding its HomePod mini production capacity in northern Vietnam to address supply constraints for the popular device.
Apple’s move is a move to reduce its reliance on China for production, as rising labor costs there, long-standing trade tensions between the U.S. and China and an Epidemic that has severely disrupted supply chains have made it clear that one country cannot be overly dependent. The U.S. government also launched a “supply chain restructuring” campaign earlier and urged technology suppliers to leave China.
China has the most comprehensive supply chain and remains an important manufacturing center for major tech companies, but Apple’s decision to move so many of its products out of the country suggests that the technology decoupling between the U.S. and China is likely to continue until 2021, and while some hope the political climate will improve when Biden takes over, Biden has said he will not immediately reverse the tariffs imposed on China by the Trump administration in 2018.
Apple did not respond to Nikkei News’ request for comment.
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