According to sources cited by Reuters, Foxconn, formally known as Hon Hai Precision Industry, has been ordered by Apple to shift some iPad and MacBook production lines to Vietnam from China.
Foxconn is building assembly lines for Apple’s iPad tablet and MacBook laptop at its plant in Vietnam’s northeastern Bac Giang province, to come online in the first half of 2021, the person said, declining to be identified as the plan was private.
The lines will also take some production from China, the person said, without elaborating how much production would shift.
“The move was requested by Apple,” the person said. “It wants to diversify production following the trade war.” -Reuters
Foxconn was not at liberty to discuss “company policy and for reasons of commercial sensitivity” behind the shift in production lines.
The Nikkei recently learned that Foxconn is set to invest $270 million into new production facilities in Vietnam.
Amid President Trump raising tariffs and hurling Twitter threats at China – Apple has taken steps to add geographic diversity to its supply chain in China. Apple suppliers in Vietnam already manufacture the company’s AirPods and AirPods Pro.
Other Apple suppliers, such as Pegatron and Compal Electronics, “are also considering building plants in Mexico,” the source continued. Companies continue to reduce reliance on China as they diversify supply chains.
In August, Foxconn Chairman Liu Young-way told investors that Trump’s trade war had fractured the world into two – indicating his firm had to develop “two sets of supply chains.”
Even with Trump upending decades of American trade policy in four years – the lasting effects are starting to be realized.
Despite that rhetoric of a Biden presidency would mean China would “own America” – and in some respects they already do – messaging from the Biden camp suggests they would continue the tough approach on Beijing.