A painful and difficult process
"Lower birth rates, higher labor costs and the hidden dangers of over-centralized production in a country. These disadvantages will be taken into account, regardless of the existence of further tariffs. An executive from an Apple supplier told Nikkei.
Although the White House has repeatedly claimed that Apple is open to the idea of manufacturing shifting from China to the United States, it is generally believed that production will be shifted to Southeast Asian countries, while India and Vietnam are considered to be.IPhoneThe main undertaker of production capacity. Apple had previously made low-cost iPhone SE products in India, and last year it was considering shifting production of more high-quality products to that country to avoid intelligence.Mobile phoneImport tariff effect. Foxconn recently said that if necessary, they would be able to transfer all the iPhone production supplied to the United States out of China.
Like Vietnam and India, labour markets in Mexico, Indonesia and Malaysia are also considered.
At least one supplier said that they had built a huge ecosystem of logistics and parts suppliers in China, which would be a "painful and difficult" process if they were to change one day. China has a huge workforce of skilled workers, more flexible infrastructure and less prone to electricity shortages. Mobile capacity is not a fast process. It is expected to take at least 18 months. The overall impact on the supply chain is expected to occur in two to three years.
Estimates show that about 5 million jobs in China depend on Apple's manufacturing industry chain in China, where Apple employs about 10,000 employees directly. It is not clear how many of these jobs will be affected by the loss of 15 to 30 per cent of capacity.
However, Apple does not currently have a timetable to ask suppliers when they need to respond to production transfer plans.