The latest Apple supplier to establish a presence in Vietnam is Taiwan’s Pegatron, which plans to set up production facilities in the Southeast Asian nation as they diversify beyond China, Bloomberg News reports, citing “people familiar with the matter.”
Pegatron joins Apple’s two other iPhone assemblers — Wistron Corp. and Hon Hai Precision Industry Co. — in developing manufacturing facilities or building extra capacity in Vietnam. None of the three are making iPhones in Vietnam and have no imminent plans to do so. The only Apple device Pegatron makes is iPhones. GoerTek Inc. is now making AirPods in the country, while two other Apple assembly partners, Compal Electronics Inc. and Luxshare Precision Industry Co., also have a presence in Vietnam.
An almost two-year-long trade war with the U.S. has put China’s position as factory for the world of technology in jeopardy, undermining a decades-old global supply chain and pushing electronics companies to look for alternative production bases. Though Washington and Beijing have signed a phase-one trade deal, supply-chain diversification is still essential in the longer term given tensions are unlikely to fully subside and labor costs are rising in China.
MacDailyNews Take: Manufacturing diversification in Asia is certainly paying off for Vietnam.