From Made in China to Made in India: How Apple is Decreasing Dependence on the Chinese Supply Chain. Source: Agence France-Presse
- Apple buyers are facing longer wait times for the company’s flagship MacBook Pro laptops, mainly due to the shutdown in China.
- The delays reflect Apple’s struggles to keep its Chinese supply chain running smoothly amid another Covid outbreak.
- At this point, the US giant’s second-largest Chinese assembly plant suspended production at major plants in nearby Shanghai and Kunshan.
- Apple has also started making iPhone 13 in India as it expands its production capabilities outside of China.
Apple Inc’s dependence on China has always been a frequent concern. From the outbreak of the trade wars between Washington and Beijing, to the time when Apple’s suppliers in China were subject to the forced labor program and the most impactful supply restrictions to date linked to Covid-19. All of this highlighted the urgent need for Apple to reconsider its production base as its next best option – India.
When Apple first entered the booming Indian manufacturing space in 2015, the company was significantly expanding its market share while increasing its manufacturing capabilities in the country. Gradually, more and more Apple products are grouped in India under the “Make in India” initiative. In short, the American technology giant is gradually developing its manufacturing capabilities abroad Its traditional base is in China.
It’s not just India – in fact, Mexico and Vietnam are becoming increasingly important to contract supplying manufacturers as Apple tries to diversify production away from China. Latest update, according to ReutersDid Apple start making iPhone 13 in India? The second largest smartphone market in the world.
to me Reuters Sources, the phone is produced in a local factory of Taiwanese manufacturer Foxconn with Apple contractsIt is located in Sriperumbudur town in the southern state of Tamil Nadu. For context, the iPhone 13 is the fourth model to be produced domestically after Apple launched manufacturing in India In 2017 with iPhone SEAnd Instead of just running its own assembly line.
Foxconn, Apple’s iPhone manufacturer has previously announce Plans to set up 10 to 12 facilities in India, which would include factories and data centers. Although Foxconn has long settled most of its operations in China, it has increased labor costs and exacerbated Tensions between the United States and China Urge him to look elsewhere. Given this, India has shrewdly seized the opportunity by luring major smartphone manufacturers with attractive subsidies.
Currently, all iPhones are manufactured by three Taiwanese companies: Foxconn, Pegatron and Wistron. At this point, even Pegatron has halted operations at two subsidiaries in the Chinese cities of Shanghai and Kunshan, as global supply chains feel the tightness of Beijing’s strict measures to prevent the spread of the coronavirus.
However, Pegatron’s suspension is the latest blow to Apple, which has seen disruptions to other suppliers’ assembly lines in recent months as Chinese cities struggle to curb virus outbreaks. Foxconn even halted operations at its technology center in Shenzhen by the same March. Latest report by Bloomberg He also noted that Apple’s latest high-end models are now seeing delivery estimates pushed into June as supply chain hurdles are once again exacerbated.
As a reminder, in August 2020, Foxconn and Pegatron were among the companies said to be looking to set up new plants in Mexico to mitigate business risks. Meanwhile, Pegatron is reportedly considering a $1 billion investment in Production facilities in Vietnam.
At this juncture, despite the many efforts of Apple and its partners to diversify their supply chains, China remains a major manufacturing hub. The tech giant, which is due to report its second-quarter earnings results on April 28, is expected to give investors a window into the show’s challenges.
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