Apple
is stepping up efforts to diversify its supply chain outside of China amid tensions between the world’s second-biggest economy and the U.S.
While China remains an important manufacturing base for
Apple,
the moves suggest it feels the need to hedge its bets on the country. The U.S. has restricted exports of some chips to China on concern that they might be used for military purposes. China, for its part, has banned government officials from using iPhones at work.
Two separate reports on Friday show how Apple is trying to reduce its reliance on China, which is also important to the company as a market for its goods. The tech giant will make at least 50 million iPhones a year in India within the next three years, equivalent to a quarter of the smartphone’s production, The Wall Street Journal reported.
Separately,Apple is moving product development of the iPad to Vietnam for the first time Japanese newswire Nikkei reported. Apple is still working with China’s BYD, an assembler of iPads, even as it moves new product resources to the neighboring country.
Both stories cited unidentified people familiar with the plans. Apple didn’t immediately respond to a request for comment from Barron’s early Friday.
China is still struggling to regain its growth momentum since emerging from Covid-19 lockdowns a year ago. Data on Thursday showed that exports from the country snapped six months of declines in November, but the 0.5% gain is still meager. Hong Kong’s Hang Seng Index lost 3% this week.
Apple shares were little changed in premarket trading.
Write to Brian Swint at brian.swint@barrons.com
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