Apple is apparently accelerating its plans to migrate production outside of China. According the The Wall Street Journal, the company is looking to relocate production elsewhere, with a focus on India and Japan.
It’s been reported that in recent weeks, Apple has accelerated its plans to shift some of its production outside China. The article noted that Apple has been informing its suppliers about the shift in production anywhere outside of China.
Apple is also said to have expressed a desire to break away from its reliance on Chinese manufacturer Foxconn. Foxconn’s largest iPhone factory has recently been hit with issues related to stricter COVID-19 restrictions that the Chinese government has imposed as part of its zero-COVID policy. As such, the company has dealt with some workers leaving, having to hire and train new ones, and newly-hired workers protesting, the protestors stating that Foxconn failed to give them the salary benefits promised during their recruitment. Foxconn admitted the oversight and promised to pay the employees.
Apple, in turn, has faced the possibility of being about six million iPhone 14 units short in 2022. The company is looking to move its production to other countries, and India and China have been supplying Apple with products, though the production levels have yet to reach the same capacity as that China.
To change this, manufacturers in the two countries must start doing more than playing second fiddle to China. Manufacturers in these countries must learn to do new product introduction, or NPI. This is when Apple assigns new teams to work with contractors in translating its product blueprints and prototypes into a detailed manufacturing plan.
Unless manufacturers in India and Vietnam are able to do NPI on their own, production will fall short. Apple has also had difficulty deploying workers to companies due to its hiring slowdown and global economic tensions. It’s up to the manufacturers to prove that they can do NPI work. Only then can Apple be assured of a steady supply of iPhone and other products despite letting go of China’s manufacturing hub.
Stay tuned for additional details as they become available.