Apple plans to shift some of its production outside China. Ming-Chi Kuo said that the Apple AirPods Pro 2 is the first device to be mass-produced outside China. It will be one of the few successful cases of Apple relying on sites other than China for mass production.
Apple is looking into alternative locations for some time now. But replicating China’s production capacity isn’t as easy as it sounds. However, India and a few other South Asian countries have already begun manufacturing/assembling Apple products now.
Ming-Chi Kuo’s Predictions
Kuo published a Twitter thread to explain why the AirPods Pro 2 will be mass-produced outside China. Kuo touted the news as a successful case of mass production of Apple’s products outside China.
He added that Vietnam is one of the lucrative spots to shift production due to a variety of reasons. It has adequate infrastructure and skilled labor both of which is hard to find in other countries. Moreover, Vietnam doesn’t have a complex supply chain and the laws there don’t hinder production and growth.
According to WSJ, Apple is facing issues in China due to a sudden surge in COVID cases. China has imposed stern restrictions due to which the production derailed. Apple has heavy dependence on China and more than 90% of Apple products are made there. But now, Apple is slowly working on ideas to distribute manufacturing to other countries as well.
No USB-C port for AirPods Pro 2
Ming-Chi Kuo predicted that the upcoming next-generation AirPods Pro 2 will use lighting ports. Despite facing heavy backlash from the EU over the USB Type-C port, Apple isn’t interested in making a shift. Apple AirPods 2 will sport the same old lighting port as most Apple products.
Ming-Chi Kuo suggests that Chinese companies including Luxshare ICT and Goretek should take a note. They should set up facilities in Vietnam instead of China to reduce geopolitical risks. For the past two years, India and China haven’t been on the best terms.
But Apple already has assembly plants in India, which could become the next feasible manufacturing hub. What do you think of Apple’s decision to build additional production sites? Will China become obsolete in the near future? Share your opinion in the comments.