Apple plans to move Apple Watch and MacBook manufacturing to Vietnam
Apple plans to move Apple Watch and MacBook manufacturing to Vietnam. Cupertino is currently negotiating with Vietnamese manufacturers in an effort to diversify its production outside of China.
Apple Watch trial production under plans to shift manufacturing to Vietnam
According Nikkei AsiaApple suppliers Luxshare Precision Industry and Foxconn started test production Apple Watch in northern Vietnam. With the level of sophistication involved in manufacturing the Apple Watch, it would be a big win for the Vietnamese manufacturers if they manage to get the deal done. This would be a big boost for the country’s manufacturing sector.
Besides China, Vietnam has also been Apple’s most important manufacturing hub. Vietnamese manufacturers have already been contracted to manufacture some of Apple’s flagship products, including iPads and AirPods. Cupertino has shifted iPad production to Vietnam since COVID-19 lockdowns affected the supply chain in China.
The report also states that China’s BYD helped Apple shift production to Vietnam. Foxconn has also helped produce iPads in Vietnam, Nikkei Asia reported. Additionally, Apple is looking to build a production line for its HomePod devices in Vietnam.
MacBook production is a bit more complicated
As for MacBook production, the report said Apple has also asked suppliers to set up a production line in Vietnam. However, due to pandemic-related disruptions, moving mass production of the MacBook there has been a bit slow. Additionally, the fact that laptop assembly involves a larger supply chain has affected the shift in production.
While Apple is determined to move MacBook production to Vietnam, the company is still looking for ways to make the move more profitable. Current MacBook production is centered in China, and the report says it has proven to be very profitable for Apple.
Apple’s push to diversify its production line is not only due to economic reasons. Eddie Han, principal analyst at Isaiah Research, believes electronics makers like Apple are trying to strike a balance amid US-Beijing tensions.
Geographically, we find major international electronics brands such as Apple and Samsung trying to reduce their reliance on manufacturing products in China. But on the other hand, these international players have adopted more China-based suppliers such as Luxshare and BYD for Apple, and Huaqin for Samsung to manufacture more of their products. These are measures to balance the geopolitical impacts.