As disruptions in China continue, Apple will start manufacturing iPads in Vietnam


Enlarge / The back of the 2019 iPad Air.

Samuel Axone

Amid supply disruptions related to the COVID lockdown, Apple is moving some iPad production from China to Vietnam, according to Nikkei Asia. The company is also taking other steps with its suppliers to soften the blow of supply issues in China.

This isn’t Apple’s first attempt to move some production out of China. Some iPhones have been made in India, a small number of Macs have been assembled in the United States, and Vietnam is already a major factor in AirPods production.

Apple was looking to move more production to Vietnam in 2020 and 2021, but it had to postpone some of its plans as COVID-19 outbreaks hit the country.

Apple doesn’t feel like moving everything to Vietnam would solve its problems, given that Vietnam may also be subject to lockdowns and other disruptions. And he is unlikely to move the majority of his supply lines there. But by branching out into multiple regions, Apple’s management can hope to avoid the most devastating disruptions.

Currently, the company is so dependent on specific regions in China that disruptions could impact its ability to ship new iPhones each year. It already seems possible that this fall’s product lineup will be affected.

To prepare, Apple reportedly told its suppliers to start stocking specific components “such as printed circuit boards and mechanical and electronic parts.” These stocks can be used if further closures and disruptions occur at sites near Shanghai, which Apple has historically relied on to meet demand for its products.

Inventory may worry some suppliers, Nikkei notes, because if the downward trend in consumer demand for electronics continues, suppliers could end up with components that are not needed. On the other hand, Apple would have helped foot the bill for moving supplies.

The iPad was Apple’s only major product category to show a year-over-year revenue decline in the latest quarterly earnings report. CEO Tim Cook suggested on a call with investors that supply issues were a factor.

Since the iPad and iPhone use some of the same components, and the iPhone is the most important product for the company, some analysts have speculated that Apple may have chosen to prioritize to the components of the iPhone at the expense of the iPad.

Apple is likely to introduce and ship new iPad and iPhone models this fall.


Leave a Reply

Your email address will not be published.