Chinese suppliers of Manzana move capacity out of the country a lot faster than many observers anticipateto avoid the consequences of the increasingly intensifying tensions between beijing and Washingtonaccording to one of the most important partners of the American company.
The maker of AirPods GoerTek is one of many exploring locations outside of his native China, which today produces most of the world’s devices, from iPhones to PlayStations. Initially, you will invest $280 million in a new plant in Vietnam while considering an expansion in IndiaVice President Kazuyoshi Yoshinaga said in an interview. US technology companies, in particular, have been pushing manufacturers like GoerTek to explore alternative locations, said the executive, who oversees GoerTek’s Vietnamese operations from the northern province of Bac Ninh.
“Since last month, many people from the client side visit us almost every day,” Yoshinaga said from his offices in GoerTek’s sprawling industrial complex north of Hanoi. “The topic that dominates the discussions is when we can move.”
The growing conflict between the US and China, which began with a trade war but which has since expanded to encompass sweeping prohibitions on the exchange of chips and capitalpromotes a rethinking of the supply chain of the electronic industry. The world’s dependence on the Asian country became apparent during the “zero covid” years, when restrictions from Beijing choked the supply of everything from phones to cars.
Apple’s suppliers rarely comment on its strategy, in part because of the US’s famous insistence on maintaining confidentiality throughout its global supply chain.
The iPhone maker has not indicated whether it plans to diversify outside of China, which would mean revamping a model led by Chief Executive Officer Tim Cook under Steve Jobs. The US giant has avoided suggestions that it might scale back its investment in China, where it has built an ecosystem centered on companies like GoerTek and Foxconn Technology Group, which, collectively, They employ millions.
Behind the scenes, nine out of ten of Apple’s largest suppliers could be preparing large scale removals to countries like India. Bloomberg Intelligence estimates that it could take eight years to move as little as 10% of Apple’s capacity out of China.
The GoerTek executive argues that it will be much faster.
Most Chinese tech makers are under the same pressure. “I would say that currently 90% are evaluating the issue,” he added. “These are decisions of the brand companies.”
India ranks high in customer desires, a reflection of its potential as a market and manufacturing headquarters.
“We receive requests from our clients almost every month. They ask us if we have plans to expand into India,” Yoshinaga said. “If they decide to set up production lines in India, we may have to seriously think about it. We are currently focusing on developing our production facilities in Vietnam.”
GoerTek, which also plans to make virtual reality headsets in Vietnam starting in 2024, projects the Southeast Asian country will produce more than half of its global revenue in three years, up from a third now, Yoshinaga said. The company also asks its own suppliers to scout northern Vietnam for new facilities, he said. It makes Quest virtual reality headsets for Meta Platforms Inc. and PSVR headsets for Sony Group Corp.
(With information from Bloomberg)
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Source-www.infobae.com