Apple shifts manufacturing outside China

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Apple shifts manufacturing outside China

Apple Inc. AAPL moved part of its manufacturing outside China as part of its preparations. This includes major iPhone assembly plants that have been routinely interrupted by China's strict COVID 19 regulations, with large worker protests in November.

In September, the company announced that it would begin assembling iPhone 14 models in India, a new lineup for the first time in the world's second-largest smartphone market, as analysts predict a greater shift in the American giant's future manufacturing.

Apple has three partners in India, Foxconn, Wistron and Pegatron, as well as a shift away from China.

It has two partners in Vietnam, Luxshare and Inventec, which are in charge of the AirPods and HomePods product lines.

Apple analyst Ming-Chi Kuo predicted last month that India could account for up to 45% of iPhone production.

Kate Whitehead, a former Apple operations manager who now runs her own supply-chain consulting business, getting all the elements needed to produce at the volume Apple requires is a difficult process.

Political stability, a vast workforce and the country as a significant market for Apple's products were reasons that Apple relied on China for a number of reasons, including political stability, a large workforce, and the country as a major market for Apple's products.

The ongoing COVID 19 lockdowns across China have made matters worse for Apple. Wedbush Securities analyst Dan Ives told the Wall Street Journal that China's COVID 19 policy has been an absolute gut punch to Apple's supply chain and this last month in China has broken the camel's back for Apple in China. The Taiwan Semiconductor Manufacturing Co.'s TSM new Arizona facility is expected to be producing some of the world's most sophisticated chips by the end of next year, and Apple and Nvidia Corporation NVDA are poised to be two of the first customers.

People aware of the matter say Apple will be the plant's most significant first-wave customer when it begins production, with Nvidia expected to follow suit.