Apple Cuts Losses On Electric Vehicle Project
Apple has cancelled work on its electric car, a source familiar with the matter told Reuters on 27 February 2024, a decade after the iPhone maker kicked off the mission.
Wistron – iPhone Maker To Wind Up Operations In India
Wistron iPhone manufacturing facilities in Karnataka will be taken over by Tata Electronics
Foxconn Expects Decline In Consumer Electronics Demand
Apple Reshuffles Management Team To Focus More On India
Apple reportedly reshuffled its management team and promoted a head of its Indian market, making India a separate sales region, a sign of the India’s growing importance, which has seen double-digit sales growth in the South Asian nation.
Apple Warns Of Hit To iPhone Shipments From Chinese COVID disruptions
Apple Inc on 6 October 2022 said it expects lower iPhone 14 Pro and iPhone Pro Max shipments than previously anticipated as COVID-19 restrictions temporarily disrupt production at an assembly facility in Zhengzhou, China.
Samsung’s Smartphone Shipments Drop By 8 Percent In Global Markets In Q3 2022
The latest report by Counterpoint Research brings some bad news for smartphone brands, including Samsung.
Apple To Move 25% iPhone Production To India by 2025, 20% iPad & Apple Watch To Vietnam
Apple began assembling some of its devices in India and Vietnam a few years ago, slowly cutting its reliance on China. The Cupertino-giant is now gearing up to make the two nations key global manufacturing hubs, according to analysts at JP Morgan.
Hanoi Striving To Become New Location For Iphone Production
According to Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI), Nguyen Duc Chung, Chairman of Hanoi People’s Committee is currently in discussion with Chinese corporations with the intention of diverting the entire iPhone production line to Hanoi. This is in view that the ongoing trade war has pushed investors from China to Vietnam in order to escape rising tariffs, with Hanoi rising up as the top location for investors as well as a potential production headquarters for global corporations.
Loc has also further elaborated that reasons for Hanoi being an ideal destination includes the positive impacts that the region has gained from administrative reforms, favourable weather conditions and its proximity to the Chinese market.
However, in order to feed rising demands, Hanoi has to continue improving its business environment, especially for the high-technology sector. According to Nguyen Dinh Cung, Director of the Central Institute for Economic Management (CIEM), this includes adopting a more proactive approach in attracting capital flows, speeding up administrative processes as well as utilising its advantages as a regional economic hub to create spill over effects to other provinces
According to Hanoi’s mayor, FDI is an important source of capital for social investment and it attributes to an average of 10 to 15 percent of the total social investment in the region. This has allowed FDI alone to contribute to the city’s high GRDP growth over the past few years which averages at 7.11 percent annually.
Among the 59 cities and provinces that has received foreign investment, Hanoi has also attracted the largest amount of registered capital with US$6.15 billion in the first ten months of 2018. This is equivalent to 22 percent of total investment. Ho Chi Minh City follows behind with US$4.6 billion or 16.5 percent of the total investment, and Ba Ria – Vung Tau with US$2.4 billion, accounting for 8.8 percent of total investment.
The highest grossing projects in the first ten months of 2018 include the smart city project in Dong Anh district, Hanoi with total investment capital worth US$4.138 billion and the US$600 million Lotte Mall Hanoi project that encompasses a hotel, apartment, office, and trade centre complex.
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Taiwanese Companies Shift Production To Taoyuan As Trade War Heats Up
TAIPEI, TAIWAN: According to Bloomberg, Taiwanese technology companies are shifting production to Taoyuan from China due to an intensification of the trade war. This indicates a reversal of previous trends whereby manufacturing plants were shifted to China from Taiwan.
As 15 of the 20 largest exporters from China to the U.S. in 2016 were run by Taiwan companies, these companies are highly susceptible to trade war induced tariffs and are working to avoid current and potential future tariffs on technology based products that are made in China. At the same time, the region’s proximity to Taiwan’s largest international airport, the Taiwan Taoyuan International Airport, as well as existing facilities in the surrounding region, have made this an attractive region for manufacturing operations.
Similarly, as per Bloomberg’s report, companies that have shifted to Taoyuan from China include iPhone assembler, Pegatron Corp, laptop maker, Compal Electronics Inc. and Apple Supplier, Inventec. In addition, Barry Lam, Chairman of Quanta Computer Inc. has also released a statement regarding the company’s shift to Taoyuan and in this case, Quanta will not only be shifting its supply chain of high end products back to Taiwan, the company is also looking to shift its focus to the development of new products such as smart medical care, smart manufacturing, and smart household items along with the establishment of a new AI research center.
Angela Hsieh, an economist from Barclays has also commented that, “There are still a lot of uncertainties surrounding a trade war, so companies tend to first add capacities in their existing facilities in Taiwan instead of spending a lot to build new plants.” A view that is echoed by Elton Yang, chief financial officer of Quanta, when he stated that, “The fastest way is to add capacity in existing facilities. Looking for new land and building new facilities elsewhere will be too slow.”
According to findings from Sinyi, a Taiwanese real estate company, from January to September this year, Taoyuan has sold more industrial land and factories than any other city in Taiwan. Michael Wang, a manager at Sinyi has also told Bloomberg that this is because more land is available in Taoyuan and it is easier to acquire land there than in Hsinchu. The land in Taoyuan also has the added bonus of being cheaper than Taipei and the local government is collaborating with real estate companies to facilitate the acquisition of land by manufacturing plants.
Meanwhile, in an interview with the Wall Street Journal, American President Trump has stated that if a deal cannot be brokered with Chinese President Xi Jinping at the G20 summit in Buenos Aires, he will be looking to enforce tariffs on the remaining lot of $267 billion worth of Chinese products imported into the U.S.
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Trade War Pushes Apple’s Manufacturing From China To Vietnam
The ongoing trade war between the U.S. and China has disrupted global supply chains and pushed smartphone production to Southeast Asia. According to the Nikkei Asian Review, GoerTek has already announced its intention to shift production of Apple’s wireless earphones from China to Vietnam to evade tariffs and political tensions, with the company kickstarting the process by seeking input from its suppliers on the feasibility of shipping the necessary materials and parts for Apple’s AirPods directly to Vietnam. Although further discussions with Apple is still required to finalise this decision, GoerTek currently already has a production facility in northern Vietnam which produces wired headsets for iPhones.
Apple products such as AirPods, the Apple Watch and the smart speaker, HomePod, have been exempted in initial tariffs involving US$200 billion worth of Chinese goods, however, Trump has already threatened to impose tariffs on an additional US$267 billion worth of products from China in the near future. This would mean that the value of Chinese products that would be impacted by tariffs will reach US$517, and this would exceed the value of Chinese imports to the U.S. in 2017 that were worth US$505 billion.
Meanwhile, Cheng Uei, a supplier for Apple’s and Andriod’s chargers and connectors has commented that it is also considering shifting production back to Taiwan as well as Southeast Asian countries such as Thailand, Vietnam and the Philippines due to the trade war. Although this process also invites its own set of challenges, as Chairman T.C. Gou has elaborated that leaving China will mean the disruption of established supply chain networks and Chinese tax incentives and investment policies.
As of now, China constitutes Apple’s most important manufacturing base and functions as an important consumer market for the brand with sales from the country representing 20 percent of the company’s annual revenue.
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