U.S.-China trade tensions prompt Apple to consider diversifying supply chain out of China

Yoko Kubota and Tripp Mickle for The Wall Street Journal:

Apple Inc. is asking suppliers to study shifting final assembly of some products out of China, people familiar with the matter said, as trade tensions prompt the company to consider diversifying its supply chain.

While any major changes would be difficult and could take months to years to implement, Apple is looking into the feasibility of shifting up to a third of the production for some devices, some of the people said. Destinations under consideration include Southeast Asia, the people said…

The situation is delicate for Apple, given its longstanding dependency on China for manufacturing and as a market. Many manufacturers are shifting some production out of China to avoid the higher tariffs Washington is imposing on hundreds of billions of dollars in Chinese-made goods.

Apple assembles most of its products–including the iPhone, iPad and MacBook–in China through contract assemblers such as Pegatron Corp., Wistron Corp. and Foxconn, which is formally known as Hon Hai Precision Industry Co.

Still, Apple is making contingency plans. To avoid this new wave of tariffs, Apple has accelerated production and shipment of some China-made products for stockpiling, the people familiar with the matter said.

MacDailyNews Take: Again, best to investigate and diversify now than to be caught flat-footed, overly dependent on one country in the future.

7 Comments

  1. They’ve BEEN paying a Chinese company for manufacturing for years. Oh, you mean, they should have paid the Chinese company a long time ago to make them in another country.

    Well, fine, but you’re not going to get away from paying the Chinese company. Just hope you’re ok with that.

    1. Whatever helps them sleep at night! 🙂

      Simply put, the PRC claims Taiwan to be part of the PRC as it is the successor state to the ROC (which it views as losing the civil war), and the ROC views the PRC as an illegal state occupying China.

      I see, they’re not a Chinese (PRChina) company, they’re a Chinese (ROChina) company! Well, that makes all the difference doesn’t it?

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