In a first such move, Apple is reportedly planning to shift some iPad production out of China to Vietnam amid COVID-lockdowns in and around Shanghai, a media report said on Wednesday. According to a report in Nikkei Asia, the iPhone maker has asked multiple component suppliers to build up their inventories to meet future shortages and supply chain issues. “The iPad will become the second major line of Apple products made in the Southeast Asian country, following the AirPods earbud series,” said the report.
Apple shipped 58 million iPads last year. China’s BYD, which is one of the leading iPad assemblers, helped Apple build production lines in Vietnam. According to the report, it “could soon start to produce a small number of the iconic tablets there”. The Cupertino, California-based tech giant has also asked suppliers to move quickly to secure supplies of some chips for the upcoming iPhones.
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“The requests apply to all of Apple’s product lines — iPhones, iPads, AirPods and MacBooks,” said the report, citing sources. Apple was yet to comment on the report. Shanghai on Wednesday began reopening the city and restoring the normal order of production and living, on the premise of containing the overall risk of COVID-19. According to reports, Shanghai ended its two-month citywide lockdown, cautiously giving free rein to 2.67 million businesses to resume operations.
Apple CEO Tim Cook said in the company’s latest earnings call that “we have estimated the constraints to be in the range of $4 to $8 billion and these constraints are primarily centred around the Shanghai corridor”. “The Covid-related disruptions are also having some impact on customer demand in China,” added Apple CFO Luca Maestri.
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More than half of Apple’s 200 main suppliers have facilities in Shanghai and the surrounding regions. In Shanghai, 31 companies run production facilities that supply to Apple.
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