In a significant push for Make In India, Apple plans to eventually move its production units out of China and start producing in countries like India. According to the Wall Street Journal, Apple has instructed the manufacturers it outsources to the tech giant wanting to move out of China, citing Beijing’s strong anti-coronavirus stance, among several other factors.
The report also stated that the countries like India and Vietnam, where a minor portion of Apple’s global production comes from, are likely to emerge as the top choice as nations that the manufacturing corporations are considering as alternatives to China.
According to estimates, independent contractors manufacture more than 90% of Apple products in China, such as iPhones, iPads, and MacBook computers. Beijing’s Communist regime and the conflicts it has had with the US government are other reasons Apple wants to move its production facilities outside the country.
According to those familiar with Apple’s manufacturing plans, the company sees India as the next China because of its significant population and low costs.
Except for India, China has the largest pool of qualified workers compared to other Asian countries. Apple has worked closely with the local government in China to guarantee that its manufacturing contractors have enough land, personnel, and supplies to assemble iPhones and other devices in their massive plants.
IN APRIL, Apple CEO Tim Cook said, “Our supply chain is truly global, and so the products are made everywhere.” He also said, “We continue to look at optimizing.”
Before COVID-19 spread over the world in early 2020, Apple was already trying to take its production units away from China, but the pandemic hindered all plans. According to people familiar with the negotiations, Apple is pressing again, directing contractors where they should search for new manufacturing capacity and heavily prioritizing India and Vietnam.
Because of China’s travel restrictions, Apple could only send a handful of executives and engineers to the country to take stock of their contractors’ production facilities. The limited number of engineers and executives meant that Apple couldn’t assess these facilities as thoroughly as they would have liked to.
Furthermore, severe power outages in several parts of China’s prominent industrial estates and the anti-covid policies in Shanghai, which have caused supply-chain issues, have tarnished China’s reputation for dependability.