Earlier this week, Foxconn announced it was fully capable of moving all of the iPhone assembly lines to Apple out of China if the trade war between the US and China continued to escalate, affecting import tariffs. hit on iPhone, can be up to 25% as many other consumer goods are subject to taxes when imported into the US. Of course this could create problems and revenue losses for Apple.
Talking to investors, Young Liu, director of semiconductor chip division of Foxconn, said that 25% of their products are assembled outside China, and Foxconn’s factories in other countries have enough. ability to withstand Apple’s stringent requirements for iPhone sales. But after all, Apple may not want to do this, according to analysts. Moving the iPhone assembly site is not feasible at all.
Wedbush analyst Dan Ives said: “Apple has put a big bet on Foxconn and China, and it is estimated that if there is a move to iPhone production, in 2020, it will be only 5 to 7% of iPhone shipments are from India. ”He describes Chinese factories as” iPhone hearts and lungs, and they cannot be replaced. “
Concerns about the commercial war began to make comments that Apple should, or will shift iPhone production to, other countries appear. The scale of production itself and Apple’s dependence on factories in China have led many experts to say that it will play a huge role in the ongoing hot war. However, according to Ives, “Apple is tied to the hands”, unable to transfer iPhone production to other countries. The cost, plus the difficulty of finding parts suppliers in the new location, made it almost impossible to leave China. “Apple has billions of reasons why they want this trade war to end.”
Meanwhile, William Ho, an analyst at 556 Ventures, said that everything is possible, but it is accompanied by a sharp increase in the cost of iPhone production, which in turn hits Apple’s revenue. . In the last two years, Apple has produced a cheap iPhone SE in India with its partner Wistron. Last April, The Economic Times reported that Apple could produce iPhone X in India.
But even if this happens, it will still be a long story until Apple is completely separate from its Chinese partners, factories producing iPhones, iPads and Macs in Mainland. />
Not to mention, if leaving China, Apple is also likely to face a new wave of protests from Chinese, Apple’s largest iPhone consumer market. Financial disaster is unavoidable. Therefore, the benefits are few, but with a very high risk, Apple will not be foolish to leave “the factory of the world”.