It is no secret for any connoisseur or follower of Apple, that it depends too much on China. Said country has granted great productions, being the best in its field as a supplier of the company. However, it is also to be criticized that on different occasions dependency has been taken to a critical level.
Currently, TSMC, known as the best manufacturing company that supplies technology giants, intends to distribute the type of production to other sectors, as well as to another country. Under this decision, iPhone maker notified other manufacturers of Apple’s situation to reduce dependency on Chinaobtaining production outside that country.
Meanwhile, Apple has been pretty stifled with the situation. The entire production line in China has to face the shutdown due to COVID-19. The strict measure in the country has severely stifled the workforce of suppliers. After these terrible events collapsing billions by Apple, the company has had to resort to other options outside that country, holding talks with partners in other places that can provide them.
Factors for Apple’s search outside of China
Apple would have already taken these measures a short time ago. Having conversations with other suppliers warning that it will look for an increase in supply that is not in China. All the information was recently brought to light by media sources Wall Street Journalso it also indicates that those close to Apple to These talks take as an argument the strong measures by COVID-19 in Beijing.
The factors on the part of the company are clearly seen by the entire technology sector, since they are not the only ones affected. The closure of China includes serious losses, but it also affects the entire line, including the distribution line to fill orders. This labor suffocation comes from the product requested for engineers as a transformation in the way of working.
Everything that Apple has worked on during this quarter, although slowly surpassing the previous ones, it is evident that the closure by COVID-19 will take its toll in the following fiscal period. The supply line will be reflected in the following results, which from now on is noted with the loss as the best valued company. The results for the moment forecast revenue losses between 4,000 to 8,000 billion dollars that will arrive in the third quarter.
Is Apple finally moving away from China?
Outside of the health section, Apple understands the problems that go beyond this. The United States does not have the best relationship with China at the moment, so could lead to an even more serious problem in the future for the company. So having such a close dependence on the Asian country is not the best option if you want to continue fighting for positions in other parts of the world for future and probable trade wars.
Rumors and speculations had commented on the possible separation of Apple with China. Although this is merely an exaggeration itself, it is true that the company has had enough time to consider moving the supply chain to a country other than China. The strict sanitary measures have hastened this decision by the company so as not to be in such a hurry with the losses.
Although Apple it has already better focused its supply chains, having one in Vietnam and India focused on total production. The company does not stop the idea of ​​expansion in these countries by looking at other bidders located in other countries that fulfill the function of relieving production in China. At the moment, sources close to the structure of Apple’s plan indicate that the best current option is India as it is so similar to China.
However, a possible “mistake” by Apple was to consider a country that does not have the best relations with China either. India is being a slight conflict with the suppliers to finish establishing due to this situation between countries, according to some sources. Analysts, for their part, consider the factory in Vietnam to be the best alliance.
For its part, the company is accelerating changes and movements to suppliers outside the country. In the event of a complete changeover, suppliers in Vietnam and India would be a large-scale focus for the company’s production.
