Apple is attempting to accelerate its shift away from Chinese manufacture as demonstrations over the country’s strict zero-Covid policies grow and riots disrupt production.
According to the Wall Street Journal, the technological behemoth is stepping up attempts to relocate production to other Asian countries such as India and Vietnam in order to separate itself from Foxconn, one of the company’s key suppliers and the operator of the world’s largest iPhone plant in China.
While the move has been planned for months, insiders told the Journal that recent uprisings at the Zhengzhou facility have pushed Apple to take action.
At November, employees in Zhengzhou’s “iPhone City” erupted in violent protests over withholding pay and strict zero-Covid restrictions, prompting a lockdown. As the protests increased, Foxconn, which employs over 300,000 manufacturing workers, offered them $1,400 to quit and later $1,800 bonuses to stay in order to keep its haemorrhaging workforce.
The protests, which took place at the start of the holiday shopping season in the United States, caused substantial supply chain disruptions and shortages of Apple iPhone items. According to Bloomberg, the company is projected to face a shortage of 6 million iPhone Pros as a result of the protests.
The impact of the turbulence on Apple’s bottom line has created a sense of urgency to diversify production away from China, which has long dominated the company’s manufacturing. However, the Journal claimed that the economic downturn and delayed hiring are making it difficult to outsource production and form partnerships with new suppliers.
According to the Journal, Apple intends to source up to 45% of iPhone production from factories in India, where it presently produces in the single digits, and to increase production of products such as desktops, watches, and AirPods in Vietnam.
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