By Bilal Hafeez 18-07-2019

Apple Tests AirPods Production in Vietnam as it Cuts China Reliance (Asian Review, 4 min read)


(You can read the article by clicking here)

The headline is a bit misleading: Apple’s ties with China remain strong. But it has asked its Chinese supplier, Goertek, to set up production facilities in Vietnam. The logistics are changing in reaction to the US-China trade war and because of rising labour costs in China. Vietnam is cheaper and yet keeps production close to China. Other tech companies are following suit, however President Trump has recently threatened to impose tariffs on Vietnam, which could threaten these shifts.

Why does this matter? This piece is a great breakdown of a large scale trend: the trade war is pushing US companies to include other Asian countries in the final links of the supply chain, whilst maintaining their use of China where they can. Vietnam seems to the big winner at the moment, though others could follow. Needless to say the US is not seeing any onshoring.

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