Diversification of manufacture of Apple products outside of China runs its course. The trade war unleashed by the outgoing Trump administration prompted companies like Apple to study other locations for their contractors’ plants. Now, Foxconn has obtained permission to build one in Vietnam valued at 270 million dollars.
In it, they are expected to be manufactured different iPad and Mac models. Although it is not specified which ones exactly.
Designed by Apple in California, assembled in Vietnam
The Vietnamese government granted yesterday Monday a license to Foxconn to build a plant of 270 million dollars, picks up Reuters. Located in the northern province of Bac Giang, the government says it will produce “eight million units”, although it does not specify the mix. In the past, Apple sold about 40 million iPads and 20 million Macs a year, so that would be a fraction of the total.
Foxconn has invested a total of $ 1.5 billion in total in Vietnam. And in his plans is to increase the investment in 700 million more, hiring 10,000 additional workers. The publication also includes another item of 1.3 billion for Thanh Hoa province, south of Hanoi.
In recent years, Apple has begun to diversify its manufacturing in other Asian countries and the rest of the world
The move comes after Apple asked the company to move part of its production to the Asian country. As we can see, it is a way to take a fraction of the total manufacturing. It is a way to reduce the risk related to trade tensions.
Diversifying the supply chain also makes it more complex. Although it is compensated with lower labor costs, since in China the labor cost index has doubled in the last decade.