In a move to accelerate product diversification, beyond China, Apple has decided to shift production of its iPhones, iPads, and Mac to other Southeast Asian countries including India and Vietnam. This despite hopes that the Biden administration will ease trade tension between the United States and China. According to a report by Nikkei Asia, Apple is planning to start making the iPhone 12 series in India as soon as this quarter. Cupertino also plans to start the production of iPads in Vietnam as early as the middle of this year.
The report said that Apple will also shift the production base of products like earphones, smart speakers, and computers out of China. The move will be part of the company’s ongoing diversification strategy.
The California-based company is reportedly mobilizing suppliers to increase the production capacity of its ‘affordable’ voice-activated smart speaker – HomePod Mini. Ever since the device was launched in 2020, it has been produced in Vietnam. Local production of other audio-related products and various AirPods line-ups in Vietnam has already been increased.
The publication quoted a source as saying that the production of MacBook will also be shifted to the Southeast Asian country this year and that of Mac mini has already been shifted to Malaysia.
“There are several other tech companies that want to shift production base out of China. Imagining it two years ago was impossible, but it can be done now,” a supply chain manager told the publication.
Apple suppliers are also following the shift and are looking to move to Vietnam. For example, supplier Foxconn has already invested USD 270 million for a subsidiary there. Also, Luxshare Precision Industry is ramping production in the country.
The report noted that Apple will now produce a considerable number of devices outside China. India is the second-largest production base for the iPhone.
The shift in base started in 2020 and is likely to continue in 2021 as US President Joe Biden said that the tariff policy by the Trump administration will not be immediately reversed.