Mexico and Malaysia could make Apple products

Fleeing China: Mexico and Malaysia could make Apple products

It is not news that Apple is taking part of the production of iPhones (and possibly other products) from China. The reason is clear: the trade war with the United States, which is damaging the company and could do even more damage depending on the mood of American President Donald Trump.

This trade war, of course, could pass. But Apple is apparently determined and other reasons have weighed in favor of this decision: the lower birth rate, higher labor costs and the risk of excessively centralizing its production in one country. In other words, the idea of ​​diversifying production should have been around Cupertino for some time, but the trade war must have served as a trigger.

China, as we know, has been Apple’s production base for two decades. Today, there are about 5 million jobs which depend on Apple’s presence in the country – more than 1.8 million software and iOS developers enter this account, in addition to the company’s 10,000 employees in the country. And that importance will not change anytime soon, since such an implementation does not happen overnight.

Even more when we are talking about changing 15% to 30% of this production, according to the Nikkei Asian Review – according to the publication, a team of more than 30 people is discussing production plans with suppliers and negotiating possible tax incentives (taking into account regulations and the local business environment) with governments that may attract Apple.

Currently, more than 90% of Apple’s production takes place in China, but Apple’s partners have already confirmed plans to set up operations in India, Indonesia and Vietnam. The Asian vehicle, however, raised the possibility of Mexico and Malaysia also join the game.

Apple’s wish will not be easy to fulfill. In the 2000s, China made a major structural investment to accommodate such productions, and perhaps these other possible countries will not be able to create a similar scenario as quickly. Example: some Apple vendors have already “lost” three to five months of evaluating a location and then discovering that there was a risk of energy shortages – which, of course, precludes any possibility. Not to mention that, after this analysis and the choice of locations, Apple partners need at least 18 months to start production at a test pace.

Apple, of course, did not comment on the matter, but apparently the idea of ​​»fleeing» from China is already a consensus among Cupertino’s key executives.