Apple is reportedly moving iPad production out of China for the first time ever because of Trump's trade war

[Johnny Dinar]

Reuters and Isobel Asher Hamilton 

3 hours ago

 

 

• Major Apple supplier Foxconn is moving some production of the iPad and Macbook from China to Vietnam, a source told Reuters.
• The source said Apple requested the move as a way of making its supply chain less reliant on China, following the trade war between the nation and President Donald Trump's administration. 
• This will be the first time the iPad has been manufactured outside of China.

 

Major Apple supplier Foxconn is moving some iPad and MacBook assembly to Vietnam from China at the request of Apple, a person with knowledge of the plan told Reuters, as the US firm diversifies production to minimize the impact of a US-China trade war.

The development comes as the outgoing administration of President Donald Trump encourages US firms to shift production out of China. During Trump's tenure, the United States has targeted made-in-China electronics for higher import tariffs, and restricted supplies of components produced using US technology to Chinese firms it deems a national security risk.

Apple was able to skirt some the tariffs, but it seems the iPhone-maker is wary that being dependent on China for its global supply chain, which could make the company vulnerable to geopolitical forces.

Apple's dependence on China was also thrown into stark relief at the beginning of the coronavirus pandemic, as the outbreak caused major disruption in the company's supply cahin.

 

Apple did not immediately respond to a request for comment.

Taiwan's Foxconn, formally Hon Hai Precision Industry Co Ltd, on Tuesday announced a $270 million investment to set up a new subsidiary called FuKang Technology Co Ltd — a move the person said was aimed at supporting the Vietnam expansion.

Shifting iPad production to Vietnam will mark the first time Foxconn has assembled the device outside of China.

This isn't the first indication we've had that Apple is looking to seed its global supply chain beyond China.

 

The firm already plans to spend up to $1 billion expanding an iPhone assembly plant in India as "strongly requested" by Apple to diversify production beyond China, people with direct knowledge of the matter told Reuters in July.

Foxconn and peers such as Pegatron Corp are also considering building plants in Mexico, people with knowledge of the matter said, as Washington promotes near-shoring production.

Foxconn Chairman Liu Young-way in August told investors the US-China trade war had split the world into two, saying his firm aimed to provide "two sets of supply chains."

 

Apple moving iPad, Macbook production from China to Vietnam - Business Insider

[Sage449]

Seems a tad late, Trump started the tariffs changes in 2016-2019. Early 19 or 20 began the Phase I reset. Head scratcher Apple wants to move now, except doesn't like new payments and moving yet cheaper.

[Johnny Dinar]

On 11/26/2020 at 1:43 PM, Sage449 said:

Seems a tad late, Trump started the tariffs changes in 2016-2019. Early 19 or 20 began the Phase I reset. Head scratcher Apple wants to move now, except doesn't like new payments and moving yet cheaper.

 

I think the point is they are not moving to America. Foxconn the big manufacturer was supposed to move to Wisconsin, but I don't think that is happening. 

[Sage449]

Sounds like this is still moving forward- so can't be the reason. Something else is happening.  

https://www.digitimes.com/news/a20201127PD214.html

Foxconn developing server manufacturing capability at Wisconsin plant

Ninelu Tu, Taipei; Joseph Tsai, DIGITIMES

 Monday 30 November 2020

 

Foxconn Technology Group (Hon Hai Precision Industry) has disclosed it is developing manufacturing capability catering to local needs for datacenters and high performance computing (HPC) applications at its Wisconsin site in the US.

The EMS provider made the disclosure in reponse to claims that it had obtained server orders from Google and would fulfill them from the Wisconsin plant. But Foxconn did not comment on the claims about Google's orders.

Foxconn chairman Young-Way Liu also pointed out the products to be manufactured at the Wisconsin plant will be decided mainly by clients and market demand. Liu believes the plant is suitable for manufacturing products such as servers.

The server business has become a key growth driver for Foxconn in the recent years and is expected to contribute nearly NT$1 trillion (US$34.76 billion) in sales a year. Of the amount, 30% will be coming from cloud computing service providers.

Foxconn is currently a partner of Amazon, Microsoft and several Chinese server companies and datacenter operators, according to industry sources.