WHAT YOU NEED TO KNOW:
- Violent clashes erupted in China between iPhone factory workers and security officers over the nation’s zero-COVID policy.
- The recent protests pushed Apple to fast-track its plan to shift production out of China, which produces the majority of the world’s iPhones.
- Apple plans to look into manufacturers in other Asian nations like Vietnam and India.
Apple’s plan to move iPhone production out of China could be fast-tracked amid violent protests over the country’s zero-COVID policy, the Wall Street Journal reported on Saturday.
Workers of the world’s largest iPhone factory, called iPhone City, violently clashed with security officers over strict policies and deplorable working conditions.
The factory houses about 300,000 workers and accounted for 85 percent of the iPhone Pro lineup at one point.
Apple is planning to reduce its dependence on Taiwanese electronics manufacturers like Foxconn, which owned the Zhengzhou facility. It plans to move its production to other Asian nations like Vietnam and India.
Earlier this week, CNN reported that Foxconn may also move production out of China.
In recent years, Apple has been confronted with issues in manufacturing and supply amid the pandemic. Tensions between the U.S. and China have also strained their business plans.
Alan Yeung, a former U.S. executive for Foxconn, noted that people weren’t used to paying heed to “concentration risks” since “free trade was the norm and things were very predictable,” but this might no longer work in “a new world.”
While Apple looks for reliable manufacturers that can handle their new product introduction (NPI) process, they are still looking for a large pool of assemblers, which can still come from China.
Through NPI, Apple translates its latest product blueprints into a detailed manufacturing plan. This process could be too advanced for other countries such as Vietnam or India.
Kate White, a former operations manager at Apple, pointed out, “Finding all the pieces to build at the scale Apple needs is not easy.”
Source: FOX Business