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    Apple’s Slow Move Away from China and Taiwan Raises Concerns

    Apple's Slow Move Away from China and Taiwan Raises Concerns

    Apple’s Slow Move Away from China and Taiwan Raises Concerns

    Apple is facing a critical point in its relationship with China as it moves iPhone production out of the country. Bloomberg’s Mark Gurman reports that Apple wants to move more iPhone production to India, where it produced 6.5 million units last year and aims to hit 10 million this year. In 2023, iPhone 15 non-Pro models will be built simultaneously in China and India for the first time, while iPhone 15 Pro and Ultra models will only be assembled in China.

     

    Apple managers are telling employees to look for places outside China to source components and place production lines for new products coming next year. However, Apple needs to continue its current relationship with China since 20% of its revenue comes from Greater China, including Taiwan and Hong Kong. Apple has 40 Apple stores in mainland China, and most iPhone units are still assembled there.

     

    Risk of Consumer Boycott:
    China and Apple are heavily intertwined, as seen during China’s COVID crackdown, which affected workers at Foxconn’s largest iPhone production facility in Zhangzhou. Apple’s top brass is worried that if it moves too quickly to pull production out of China, the move will backfire as Chinese consumers stop buying the iPhone and other Apple products.

     

    Apple’s Ties with Taiwan:

    Apple is also looking to back away from Taiwan since it relies on the Taiwan Semiconductor Manufacturing Company (TSMC) to manufacture all of its chips. Starting next year, TSMC will begin producing 4nm chips at its fab in Phoenix, Arizona, and a second fab will start turning out 3nm chips by 2026. Apple will purchase chips from TSMC’s U.S. facilities for other devices to reduce its reliance on TSMC’s Taiwan fabs.

     

    If TSMC’s Taiwan factories go down, it would take over a year to ramp up production to the previous level.

     

    Read More: iOS 17 Set to Debut with Control Center Revamp and Focus on Performance and Stability

    iOS 17 Set to Debut with Control Center Revamp and Focus on Performance and Stability

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