There was a time when all top brands moved their production to China because of low labor costs and convenient laws. But now, there is a war between China and the US. This refers to all parties, including Apple. Today, it became known that Apple asked its suppliers to start planning to transfer production from China to Southeast Asia. This decision is conditioned by the fact the Cupertino-based company is worried about the risks posed by China’s manufacturing industry.
The Nikkei Asia Review reported that Apple is preparing for a major restructuring of its supply chain. It already requires major suppliers to assess the cost of transferring 15% to 30% of their production to other countries.
This move is partly due to the current escalation of tensions. But it is reported that even if the situation is eased, Apple intends to continue to implement the plan and believes that there are many risks in China’s manufacturing industry.
A source said the company is concerned about rising labor costs and over-reliance on Chinese manufacturing.
China has always been a key part of Apple’s global success, where its suppliers are able to call hundreds of thousands of workers in a short period of time to quickly respond to peak demand. About 5 million people in China rely on Apple for job opportunities, including 1.8 million software and application developers. The company also employs 10,000 people directly in China.
However, one supplier warned that copying China’s supply chain in another country is not an easy task. And China is expected to remain the core of Apple in the short term. ‘This is a very long-term effort and may see some results in two to three years.’ Another supplier also said, ‘This is a painful and difficult thing, but we have to deal with it.’