India, Vietnam and Brazil could account for as much as 30% of Apple supplier’s Foxconn production in upcoming years as Apple seeks to diversify its supply chain out of China.
Key electronics manufacturers are moving faster to diversify their capacity globally, taking advantage of local incentive policies, according to Counterpoint Research analysts Ivan Lam and Shenghao Bai as cited.
“Led by Foxconn and Pegatron, companies have already invested in factories, production lines, relatively advanced manufacturing processes, and personnel training in India,” they wrote.
The country’s vast population and high birth rate make it an attractive market for end-products as well as a manufacturing base, while Vietnam’s workforce offers lower labor costs than in China, they added.
According to the report, Vietnam has attracted 21 Apple suppliers to operate in the country, though it lacks the ability to produce the all-important iPhone handset.
Apple has reportedly tapped its top supplier, Taiwan’s Foxconn, to start making MacBooks in Vietnam as early as around May next year.
The company has been working on plans to move some MacBook manufacturing to Vietnam for nearly two years, and has set up a test production line in the country.
Vietnam will make 65% of Apple wireless AirPods by 2025 as the U.S. tech giant continues to shift its production away from China, JP Morgan analysts have forecast.
The country would also reportedly account for 20% of iPad and Apple Watch output and 5% of MacBook.
Foxconn, a key supplier, in August leased 50.5 hectares of land in Bac Giang Province and plans to build a $300-million factory there, employing 30,000 workers.