Nikkie Asia reports that Apple has planned to move some of MacBook production from China to Vietnam for the first time. The tech giant has ordered its long-term assembly partner, Foxconn to begin notebooks manufacturing by mid-2023.
When the new COVID-19 wave broke out in March this year in China, major cities saw periodic lockdowns including the manufacturing hubs in Shanghai and Zhengzhou which drastically reduced the production capacities of U.S. tech companies like Apple, Dell, HP, and others. So much so, that the tech giant officially confirmed lower shipments of iPhone 14 Pro and iPhone 14 Pro Max models during the Holiday season.
Furthermore, President Joe Biden’s administration passed a strict U.S. law that prohibits exports of “advanced technology” to companies based in China to “hobble” its chip industry by depriving it of “certain semiconductor chips made anywhere in the world with U.S. equipment.”
China’s relations with the U.S. and its zero-COVID policy push Apple to diversify MacBook production
Earlier this year, Prime Minister of Vietnam Pham Minh Chinh met with Apple CEO Tim Cook to discuss the expansion of the company’s business in the country which already ships iPad, HomePod, and AirPods.
Now the political and regional circumstances have pushed Apple to diversify its production beyond China for all of its flagship products like the iPhone, iPad, Mac, AirPods, and Beats. India and Vietnam are the company’s alternative production locations.
“After the MacBook production shifts, all of Apple’s flagship products basically will have one more production location beyond China … iPhones in India and MacBooks, the Apple Watch and iPads in Vietnam,” one person with direct knowledge of the matter told Nikkei Asia. “What Apple wants now is an ‘out of China’ option for at least part of production for all of its products.”
The report speculates that Apple’s shifting part of MacBook production to Vietnam symbolizes China’s weakening position as the world’s factory.
“Overall, China’s benefits in terms of low-cost manufacturing are fading and many U.S. clients now want some production location alternatives outside of China,” said an executive at Inventec, a key supplier to HP and Dell. “This is already an accelerating trend for almost all global brands and it will not likely change going forward.”
Earlier this year, it was reported that Apple was diversifying its supply chain in China to make sure that production ran smoothly in one area if another saw disruption due to any reason. And the company was also expanding production outside China.