Apple is considering moving its production capacity from China to Southeast Asia, at least according to a new report from Nikkei Review. The company’s representatives are discussing with suppliers how much production capacity can be transferred outside China due to the uncertainty caused by tensions between Washington and Beijing.
Apple seems to be looking to transfer between 15% and 30% of its total production capacity. As you all know most likely, China was the key to Apple’s global success, but a CEO was quoted as saying: “The low birth rate, rising labor costs and the risk of focusing their own production processes in one country” have made Apple think about diversification.
Specialized hardware assemblies such as Foxconn, Pegatron and Wistron have been consulted on possible transmission of production lines. The new countries likely to be targeted include Mexico, Indonesia, Malaysia, India and Vietnam, but the latter remains the preferred country. Wiston already has a factory for old iPhone phones in India, but more than 90 percent of Apple’s products are still manufactured in China.
It will take three years to move to another country, but the transition process will not be pain-free. The sources claim that a supplier spent three to five months evaluating a site, only to find out later that there was a risk of power failure. This will not happen in China, where the local government has already invested huge amounts of money in infrastructure, water, utilities and even workers’ homes, making it difficult for Apple to leave the country.
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