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| Apple has dramatically increased iPad production outside of China |
Apple is working hard to ramp up the production of iPad, iPhone, Mac and other products outside of China. This shows that the tech giant continues to increase production even as it seeks to ease tensions between US President Joe Biden's diversification.
A source told Nikkei Asian Review: iPad will start production in Vietnam by the middle of the year. This is the first time that the world's largest tablet maker has made a large number of devices outside of China.
The California tech giant is also ramping up iPhone manufacturing in India, the device's second-largest manufacturing base, and plans to start producing the latest iPhone line there starting this quarter, the source added. IPhone 12.
As part of an ever-evolving diversification strategy, Apple has also increased production capacity for speakers, headphones, and smart computers in Southeast Asia.
Apple is bringing together suppliers in Vietnam to expand production capacity for the latest HomePod mini. The device has been manufactured in Vietnam since its launch last year. Apple has increased its domestic production of audio products, including various AirPod series.
Apple has moved some of its Mac mini production to Malaysia, and some MacBook production is also slated to move to Vietnam this year, with most PC production still in China.
Apple and several other tech companies hope to build capacity outside of China, which has not slowed down despite the appointment of a new US president.
Apple's goal is to build production capacity in new regions (especially in Southeast Asian countries) for many commodities (such as iPad, iPhone, MacBook, AirPods, etc.).
Tech giants are taking steps to reduce their dependence on China as labor costs rise, trade tensions with Washington and supply chain disruptions persist. Coronavirus shipments increase the risk of overdependence on a single country.
In addition, the US government has launched a supply chain restructuring campaign urging technology suppliers to leave China. China remains an important manufacturing hub for large technology companies and has the most advanced and comprehensive supply chain in the world.
Apple's decision to move such a wide range of products abroad shows that problems between the two countries are expected to continue into 2021.
The Chinese company Goertek is the most important assembly company of AirPods, and it obligates all suppliers to examine the feasibility of moving production to Vietnam at the end of 2018, and is the first supplier to Apple to confirm the production plan.
In 2019, Apple asked several suppliers to investigate the cost implications of moving 15% to 30% of production for a wide range of product lines outside of China.
The AirPods series were first tested in Vietnam in the summer of 2019 and will go into production in 2020.
Last year, a portion of production AirPods Pro, AirPods Max, and HomePod mini were also assigned to Vietnam, and Apple will begin production of iPhone 11 in India in 2020.