Apple is exploring the possibility of moving to manufacture between 15% and 30% of its hardware components outside of China. Although Apple believes that they will not suffer retaliation from the Chinese government regarding the ban on Huawei in the United States, Apple has a team planning the expansion of production.
From Nikkei point out that Apple’s main suppliers such as Foxconn, Pegatron and Wistron are evaluating the available alternatives.
The trade war between China and the United States is the main cause of this action. And the controversy is expected to intensify later this month with the introduction of tariffs of 25% on devices such as mobile phones, laptops, and tablets.
Apple prefers to prevent rather than cure
President Donald Trump has repeatedly suggested to Apple that the company should open up to the idea of moving the manufacturing of the iPhone from China to the United States. Apple will pay attention, but it will not be in the United States, but in countries of Southeast Asia.
An executive from an Apple supplier mentioned the following to Nikkei:
“LABOR COSTS AND THE RISK OF EXCESSIVELY CENTRALIZING PRODUCTION IN A SINGLE COUNTRY. THESE ADVERSE FACTORS ARE NOT GOING ANYWHERE … WITH OR WITHOUT THE FINAL ROUND OF THE 300 BILLION DOLLAR RATE. “
Moving the production of hardware components outside of China will cause a huge logistics ecosystem, it will be a very complicated process and full of problems for Apple. In China, the production of hardware is very stable, and we hope that these changes do not affect the final products and, consequently, us consumers.