After Shanghai lockdowns: Apple is said to be building iPad production in Vietnam

Apple tablets are to roll off the assembly line in Vietnam for the first time, as the manufacturer wants to reduce its dependence on China. Suppliers should hoard components.

 After Shanghai lockdowns: Apple is said to be building iPad production in Vietnam

Apple wants to Make hardware production more crisis-proof: The group has set up production facilities in Vietnam together with the Chinese company BYD in order to manufacture iPads there, as the Japanese business newspaper Nikkei reported on Wednesday, citing informed people. Apple tablets could soon be manufactured there, initially on a smaller scale. It would be the first time Apple has produced the line of devices outside of China.

Vietnam is becoming more important for Apple

Apple has long been pursuing plans to geographically broaden the iPad final assembly, which is entirely focused on China set up, notes Nikkei. The expansion of production capacities in Vietnam was delayed by several months last year due to a corona wave. Vietnam seems to be playing an increasingly important role in Apple production, AirPods are already rolling off the assembly line there, and the AirPods Pro 2 expected for autumn are also supposed to be manufactured there.

The tough lockdowns in Shanghai and the resulting ones Serious disruptions in the supply chain and in manufacturing have apparently accelerated Apple’s plans for diversification.

Apple suppliers should build up larger inventories

To better arm themselves against supply bottlenecks and shortages, I have The group also asked suppliers outside of lockdown areas to build up larger inventories – in addition to iPads also for iPhones and MacBooks. For example, stocks of printed circuit boards and other components are to be increased, which have so far also been supplied by companies based around Shanghai. This can be a “heavy burden” for suppliers who may be left with inventory if there are no further lockdowns in China, a manager from the supply chain explained to the business newspaper.

In the current fiscal quarter alone, Apple expects the group to generate sales $4 billion to $8 billion lost due to lack of product availability. There are currently long waiting times for MacBooks in particular, and delivery times of several weeks have also been common for iPads in the meantime.

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