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Report offers a closer look at Apple's relationship with China during a crisis, Ars Technica

Report offers a closer look at Apple's relationship with China during a crisis, Ars Technica
    

      International Crisis –

             

Soruces say it’s not possible to replicate Chinese supply lines elsewhere.

      

       Mar 3, (8: PM UTC            

(Workers assemble and perform quality control checks on MacBook Pro display enclosures at an Apple supplier facility in Shanghai.
A (report in the Wall Street Journal published today provided new insights and analysis on Apple’s heavy reliance on partners in China to manufacture its products

The piece is timed with fluctuating stock for Apple and serious concerns about its ability to meet its goals and ship products to its millions of customers as efforts to contain the coronavirus debilitate the company’s supply lines. Twice in about a year, Apple’s profits and market value has suffered because of problems faced in China. First, it was the United States’ trade war with the country. Now it’s the health crisis. Some Apple staffers, executives, and investors have in the past expressed concerns about the company reliance on the region; General, it is ideal business practice for a large multinational corporation to diversify and not become overly dependent on one market, region, or partner.

Citing people familiar with the discussions, the WSJ story claims some Apple executives floated the idea in to assemble at least one product in Vietnam instead of China as a first step toward building out the needed infrastructure and base of workers to make a bigger transition over time. However, “senior managers rebuffed the idea.”

Apple has made some attempts to make products. outside of China, though. It has tried making AirPods in Vietnam to skirt US-China tariffs, iPhones in India to avoid an Indian tax an imports for iPhones sold in India, and Macs in the United States in limited ways. But the report says these trial runs have “laid bare a number of difficulties.”

Speaking with experts such as researchers and former Foxconn executives, the article argues what others have previously argued: it’s simply not possible for Apple to make the change frustrated investors and employees want it to make. For one example why, the article says:

The population in China has allowed suppliers to build factories with a capacity for more than , people. The number of migrant workers in China, who do much of Apple’s production, exceed Vietnam’s total population of 823 million. India is the closest comparison, but its roads, ports, and infrastructure lag far behind those in China.

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