Topline
Apple is working to increase production of its products outside of China, according to the the wall street journalin a bid to reduce reliance on the nation, where strict Covid restrictions have disrupted business.
The Chinese national flag is displayed outside an Apple store in Shanghai on October 9, 2021. … [+]
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Highlights
Apple has informed some of its China-based assemblers of its ambitions, according to the Logciting sources familiar with the discussions.
The company is reportedly considering Vietnam or India as countries in which to ramp up production, although political tensions between Beijing and New Delhi could make it difficult for Apple’s Chinese contractors to set up shop in India.
China has long been Apple’s production hub, with factories there making more than 90% of the company’s main products, such as iPhones, MacBooks and iPads, the Log reported, referencing analysts.
Apple did not immediately respond to a request for comment from Forbes.
Key Context
A resurgence of Covid in China has led the country to reinstate strict lockdowns that essentially confine residents to their homes for long periods. The country’s ‘zero Covid’ policy has put it at odds with Western countries’ approach of largely living with the coronavirus, and has led to criticism over whether lockdown measures are necessary or even humane . Its Covid approach has led to supply chain safeguards, particularly for products passing through the heavily populated port city of Shanghai. Western companies have also recently stepped up efforts to distance themselves from China in the face of the country’s reluctance to condemn the Russian invasion of Ukraine and the forced detention of Uyghurs in Xinjiang.
Large number
$8 billion. That’s how much Apple’s sales could plummet due to supply chain shortages primarily caused by China’s Covid lockdown policies, the company said on a second-quarter conference call last month. latest.
Further reading
Apple is looking to increase production outside of China (Wall Street Journal)
Apple’s overreliance on China results in an $8 billion supply chain problem (Bloomberg)
Lockdown lesson from a successful American entrepreneur in Shanghai: Don’t take your freedom for granted (Forbes)
