“Apple wants to Remove part of the Production from China.” Apple is looking at the possibilities of moving 15 to 30 percent of its production capacity from China to other countries.
To that end, the company has informed significant suppliers such as Foxconn,
Pegatron and Quanta Computer about the costs of such a move, according to the reports.
Currently, more than 90 percent of all Apple products in China are assembled.
Apple is looking at Mexico, India, Vietnam, Indonesia and Malaysia, among others.
India and Vietnam have the most significant opportunity to take over part of the iPhone production.
A team of more than thirty Apple employees are already negotiating with governments,
about possible tax benefits that the countries are willing to offer in exchange for bringing in Apple factories.
The plans for a partial relocation cannot be seen separately from the trade war between China and the United States.
But according to sources, Apple wants to reduce its dependence on China anyway – even if there is a trade agreement that will end the tensions between Washington and Beijing.
Apple would find that it is now too much dependent on a country.
Also, there is an ageing population and rising labour costs in China.
According to insiders, it is not easy to copy the Chinese infrastructure elsewhere.
Of the 200 most important suppliers of Apple, 41 are located in China and Hong Kong: more than in any other country.
Since the beginning of this century, the Chinese government has invested heavily in facilities,
that make the country attractive to Apple and other electronics companies.
Local authorities, for example, provided housing for employees who came to work in electronics factories.
Moving the production capacity will, therefore, take a long time.
According to one supplier, the first results will only be visible in two or three years.
Last week, a senior employee from Foxconn, Taiwan, stated that the company could have all iPhones produced entirely outside of China.
Apple already has iPhone SE and 6S devices made in India but is also planning to have some of its top models produced in neighbouring China.