Forget India and Vietnam as spare tires!Apple will always be inseparable from Made in China. In the next 20 years, China will dominate technology production.
The Indian media said before that Apple is urging its partners to increase the establishment of local factories. It is estimated that after 2025, the printed iPhone can account for more than 50%. Is this Cook’s transfer of production capacity in China?
For such behavior, the “Financial Times” reported that Apple is by far the most dependent company on China, and so much that it may never be able to completely get rid of it.
By comparison, Apple directly employs 14,000 people in China and most of the 1.5 million workers in its global supply chain are in China, the Financial Times said.
Apple and its main iPhone supplier, Foxconn, have taken high-profile steps to shift manufacturing to India and Vietnam. However, production capacity in Vietnam, for example, is still “many, many years” away from being truly competitive, a former Microsoft executive told the publication.
“It’s been incredibly challenging for us to scale up and build and make it work like it does in China,” said the executive, who asked not to be named. “The infrastructure is either very new, not proven –or it doesn’t exist.”
“We’ve had challenges sourcing components because all of our secondary and tertiary sourcing is still in China,” he or she continued. “So we just ended up shipping a lot of semi-finished products from China to Vietnam for final assembly.”
Currently, it is estimated that there are more workers in Chinese factories than the entire population of Vietnam. China’s own statistics say 293 million people will work in factories in 2021, compared with 100 million in Vietnam.
Even if Apple or someone else were able to establish an equivalent supply chain in India, Vietnam or elsewhere, there would still be the fact that China is a major producer of smelted metals, so at the very least, the raw metals from which the products are made would still come from China.
Still, Apple isn’t going to produce lower-quality iPhones or use less-capable suppliers in order to reduce its reliance on China.
“Apple can’t diversify,” a former Apple engineer told the Financial Times on condition of anonymity. “China will dominate labor and technology production for the next 20 years.”