The company is reportedly asking suppliers to explore a 15%-30% reduction in China-based production.
The ongoing trade war between the US and China could take a bite out of Apple’s production in the Communist State.
According to the Nikkei Asian Review, Apple is asking their top suppliers to study the cost of shifting up to 30% of their production out of China and into different countries.
The move comes as US President Donald Trump raises the possibility of applying tariffs to the remaining $300 billion of Chinese imports into the US.
So far, the iPhone and other Apple products manufactured in China have not been subjected to those tariffs, but if that changes the company will need to take swift action.
Yet, it won’t be an easy move, as Wedbush Securities analysts claim it will take time, as reported by Reuters:
“Analysts at Wedbush Securities said in a best case scenario Apple would be able to move 5%-7% of its iPhone production likely to India in the next 12 to 18 months.
Given the complexity and logistics involved, brokerage said, it would take at least 2-3 years to move 15% of iPhone production from China to other regions.”
Apple has also been struggling in China before the recent tariff fight:
Hardball approach gets results
The mere fact that Apple is considering this production shift shows that the hardball approach being taken by the US and the Trump Administration towards Communist China is getting results.
For decades, China has taken advantage of the West – including Canada – with forced technology transfers, devaluation of their currency, and mercantilism that devastated manufacturing and wages here at home (with the complicity of our disloyal elites). Now, with the US pushing back, companies are looking at shifting towards other countries where there is more of an equal trading relationship and the rule of law.
It’s a step in the right direction.
Photo – YouTube