Apple recently began accelerating the process of moving part of its production out of China and has told supply chain partners that it plans to increase assembly operations in India and Vietnam.
Over the past years, China has been Apple’s first choice for production when it comes to many of its main products, but it has been rethinking its dependence a lot and plans to start production in other regions. Now what is happening in China seems to have made her plans go faster than planned.
Apple is accelerating its plans to move some of its production elsewhere, and has told suppliers that it plans to assemble more effectively elsewhere in Asia, particularly India and Vietnam.
Apple hinted that it would reduce reliance on Foxconn’s factories, due to the closures imposed by China’s strict policies in dealing with the outbreak of the Covid-19 virus, in addition to the riots that occurred at the troubled Foxconn factory in Jingju, which is the largest factory for iPhone Pro phones. Apple needs to find an alternative elsewhere.
But the matter is not as easy as you imagine, as it is expected that Apple needs about eight years to transfer less than 10 percent of production outside China, although the company already has production centers that are being expanded in Vietnam and India.
The difficulty is that Apple needs a process called new product introduction, which requires Apple teams to work with contractors to turn product blueprints and prototypes into a full manufacturing plant. And for China, where there is a density of suppliers and production engineers, the process is easier for Apple.
For production in other countries, Apple has to expand the process of introducing a new product, and in light of the global employment and economic slowdown, it is difficult for it to allocate employees and suppliers to handle the process in new countries.
However, Apple has a long-term goal of shipping between 40 and 45 percent of its iPhones from India, up from the current level of just 9 percent. Meanwhile, Vietnam is expected to produce more new products, such as AirPods, Apple Watch, and MacBook computers.