Apple Plans To Move 30% Of Its Hardware Production Out Of China, Possibly To India

Apple is planning to move up to 30% of its hardware production line out of China, as reported by Nikkei. The company has had a team to evaluate the possible options and asked partners like Pegatron, Foxconn, and Wistron for suggestions.

The reason for this shift is believed to be the ongoing trade war between China and the US. However, the report said that Apple would move its production line regardless of the war’s result.

Here is what Apple’s executive told Nikkei:

While Trump has repeatedly been saying that Apple may accept the idea of moving the production line to the US, Nikkei suggested it may prefer a South East Asia country. For now, Vietnam and India are the two nations with the most potential of being picked.

Currently, Apple is having some of its low-cost smartphone manufactured in India and last year; it was reported that the company might make its more premium models here as well to avoid the tariffs on imported phones.

Recently, Foxconn said that it could move the whole production line out of China if necessary. The countries it was considering are India, Mexico, Vietnam, Malaysia, and Indonesia.

Apple has a whole ecosystem of component suppliers and logistics in China, and the decision to move out is undoubtedly difficult and painful, according to one of the suppliers.

China has a large workforce of skilled workers, and its infrastructure rarely shows issues like power shortage, which can have a disastrous effect on manufacturers. The moving process will not be anything near quick and easy at it may take at least 18 months to finish and up to three years for the company to see a result.

Apple’s decision to move out of China may affect five million jobs in this country. For now, it is unclear that what will happen to these people when Apple takes 15% to 30% of its production to another nation.

Nikkei’s report did not mention a deadline by which Apple’s partners must present plans for a nation for the company to move its hardware production to, and the iPhone maker has not yet commented anything on this matter.