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iOS

Will Apple really move 15-30% of production out of China?

By Anton D. Nagy June 19, 2019, 12:00 pm

Last week Foxconn, the Chinese company assembling iPhones, said it was ready, at any time, to move production of U.S.-bound iPhones outside of China, should Apple request it. With the U.S.-China trade war leaving its mark on technology, many U.S. companies are trying to find a way around the 25 percent punitive tax that would generate higher prices for products.

On the same note, a Nikkei report writes about how Apple might have asked its major suppliers to make calculations and assess the financial implications of moving 15-to-30 percent of production from China to Southeast Asia. What’s interesting is that the report suggests that even if the trade issues between the two countries would be resolved, Apple considers the risk to be too high on relying on Chinese companies, going as far as saying “there will be no turning back”.

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A lower birthrate, higher labor costs and the risk of overly centralizing its production in one country. These adverse factors are not going anywhere. With or without the final round of the $300 billion tariff, Apple is following the big trend — Nikkei citing unnamed sources

There are reportedly 5 million jobs in China depending on Apple’s presence in the country, with more than 1.8 million software and iOS App developers, and 10,000 of Apple’s own employees in the country. However, the report is citing unnamed suppliers who believe that a move to exit China would take Apple a long time, and that it might happen in the future, but it would take some time, a period during which Chinese suppliers should be safe.

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