From “Foxconn to shift some Apple production to Vietnam to minimize China risk” posted Thursday:
Foxconn is moving some iPad and MacBook assembly to Vietnam from China at the request of Apple Inc, said a person with knowledge of the plan, as the U.S. firm diversifies production to minimize the impact of a Sino-U.S. trade war…
Taiwanese manufacturers, wary of being caught up in the tit-for-tat trade war, have moved or are considering moving some production from China to countries such as Vietnam, Mexico and India.
Foxconn is building assembly lines for Apple’s iPad tablet and MacBook laptop at its plant in Vietnam’s northeastern Bac Giang province, to come online in the first half of 2021, the person said, declining to be identified as the plan was private.
The lines will also take some production from China, the person said, without elaborating how much production would shift.
“The move was requested by Apple,” the person said. “It wants to diversify production following the trade war.”
My take: Bloomberg adds that Foxconn will invest $270 million in the Bac Giang plant.
Edit:
Ah, Found an idownloadblog.com article from Aug 24 this year about FoxConn & Mexico & iPhones. By Evan Selleck.
Happy Thanksgiving everyone!
So for me the big takeaway is that Apple is still growing. As a 100% Apple investor, that’s important, because if Apple is still growing, then so is its value.
Reuters is reporting delays in the import of iPhone 12 series handsets made in China to India due to a border clash between the two nations back in June. Yes. Apple is moving some production from China as it expands production capacity in other nations such as India and Vietnam. Taiwanese manufacturers are also moving production and expanding capacity outside of China as a means to strategically diversify their operations.
“Yes. Apple is moving some production from China as it expands production capacity in other nations such as India and Vietnam.”
Shutting production down in China? With much respect, Robert, I personally doubt it. Expanding production elsewhere, yes. And frankly, I’d be against Apple shutting down Chinese factories, unless China went out of its way to make trouble for Apple in the country. I’ve heard nothing like that, and until I do, I suspect Apple sees the major value they gain by staying engaged with China. IMO, the jobs they’ve created there are a major reason Apple wasn’t directly attacked by China in response to the Trump Administration’s tariffs.
Please remember Apple doesn’t own the facilities that manufacture its products. It’s well known Apple’s suppliers have been investing in India, Vietnam and other locales. Never did I say “shutting down production in China.” I am saying some production is being moved from China and the company’s suppliers are reducing their reliance on manufacturing in the country. Over the next five years less product will be manufactured in China and a higher percentage of the company’s products will be manufactured elsewhere.
This has far less to do with the Trump Administration and more to do with regional political tensions involving India and Taiwan and Taiwanese manufacturers such as Foxconn needing to diversify the locations of their manufacturing operations. There’s also the issue of local manufacturing requirements for India, one of Apple’s biggest and most important emerging consumer markets.
“Never did I say “shutting down production in China.” I am saying some production is being moved from China and the company’s suppliers are reducing their reliance on manufacturing in the country.”
That sounds an awful lot like my original statement:
“I personally doubt that this is about moving manufacturing out of China so much as it is growing new capacity elsewhere. Those are two different things.”
Manufacturing is being moved from China and manufacturing will expand in India, Vietnam and other locales. In addition to the regional political issues, there’s also the issue of cost. While China will remain a significant manufacturing center, it’s no longer the “low cost leader” for manufacturing operations. Again, Apple doesn’t own the facilities that manufacture its products.
I sent some evaluation due to Nanjing to be packaged and tested. After first pass testing they had to go to Bangalore for thermal shock testing. Nanjing could not ship the parts to Bangalore- even internal to our own company! Bangalore had to request the shipment from Nanjing. This may all seem very semantic, but it causes real delays.
I am sure that without intra-corporate cooperation, it must be even worse.