14 DAY TRIAL // We’ve known for a while that Apple was planning to reduce reliance on China, and now that the tensions between the United States and China are growing, the company is believed to accelerate its efforts on this front.
Apple analyst Ming-Chi Kuo has provided more information about the strategy the company wants to use to move its assembly business from China.
And unsurprisingly, Apple will focus more on its Indian operations, but at the same time, the company will also transfer part of the production to Thailand.
“According to Apple's plan, the Indian company Tata Group may cooperate with Pegatron or Wistron in the future to develop the iPhone assembly business. More than 80% of the iPhones made in India (by Foxconn) are currently to meet domestic demand,” Kuo said on Twitter. “The potential cooperation of Tata Group and Pegatron or Wistron can accelerate the increase in the proportion of non-China iPhone production.”
The assembly lines in Thailand will be specifically aimed at the MacBook, as the device is currently entirely made in China.
“The main non-China production site for MacBook in the future may be Thailand. All MacBooks are currently assembled from production sites located in China,” Kuo says.
The plan in the long term is as clear as possible: Apple wants to reduce the likelihood of its business to be impacted by any potential problems affecting the relationship between China and the United States.
“In the medium term (within 3-5 years), at least the US market (~25-30%+ of global shipments) can be supplied by assembly sites located in non-China to reduce potential impacts from political risks (e.g., US-China tariffs). In the long run: (1) The non-Chinese markets will be supplied by assembly sites located in non-China, while the Chinese market will be supplied by assembly sites located in China. (2) Assemblers can conduct NPI (new product introduction) in China and non-China,” Kuo says.