Apple is in talks with suppliers to manufacture MacBooks in Thailand as the company seeks to expand its presence beyond China.
The company has also been mass-producing its Apple Watch in Thailand for more than a year, sources told Nikkei Asia, underscoring the growing importance of the country, and more broadly Southeast Asia, as a as an alternative production base to China.
Apple suppliers involved in the talks already have manufacturing facilities in Thailand for other customers and are discussing possible assembly and production of components and modules for MacBooks, according to sources from three suppliers directly involved. in conversations with Apple.
“Ideally, Apple asked us to establish facilities in Vietnam for MacBooks, following in the footsteps of other Apple suppliers, but we offered another option of building the product in our Thai factories, which still have massive space that can be reserved for the customer,” a senior executive from one of the vendors told Nikkei Asia.
“As MacBook assembly will begin in Vietnam first, we could also support components from our Thai factories.
Logistics and customs clearance will only take two or three days.”
The US tech giant plans to start mass-producing MacBooks in Vietnam in the first half of this year, and it’s the first time the flagship will be made outside of China.
It’s hard for Apple and its suppliers to abandon production in China, given that they’ve spent decades building a massive supply chain in the country.
During his first trip to China in three years last month, Apple CEO Tim Cook praised the “symbiotic relationship” his company has with the country.
But the geopolitical tensions that have forced the iPhone maker to rethink its supply chain show few signs of easing.
In recent years, Apple has gradually shifted some of its production capacity for AirPods, Apple Watch, iPads and MacBooks to northern Vietnam.
The number of Apple suppliers in the country has risen to 25 in 2021 from 14 in 2018 when the trade war began to escalate, according to Nikkei Asia’s analysis of the company’s official supplier list .
This growth has made the Southeast Asian country a key beneficiary of the trend towards supply chain diversification.
However, many suppliers have faced labor shortages, especially of skilled technicians and engineers, due to the surge in demand for these workers, multiple industry sources said.
“We have already asked the human resources agency to hire workers from Cambodia and Laos for our factories in Bac Ninh province,” said an executive whose company supplies Apple in Vietnam.
“The cost of labor has also increased very rapidly.
In just a few years, the base salary we offer in Vietnam is already 80% of what we offer in our factory in Shenzhen”.
Thailand is also an emerging beneficiary of the U.S.-China trade war, with many server, data center, printer and auto vendors setting up factories in the country since 2018.
Three other sources told Nikkei Asia that Apple has been manufacturing the Apple Watch in Thailand for over a year.
“What we understand is that Apple wants to build an economic scale of production capacity outside of China.
We have been helping the company produce the product for quite some time now,” said a senior source with direct knowledge of the production.
Eddie Han, principal analyst at Isaiah Research, said labor, land and cost issues in northern Vietnam have been going on for some time and some vendors have started looking for land in central Vietnam. from Vietnam.
“We know that some vendors are talking to Apple about building MacBook production lines in Thailand, but it seems Apple isn’t very keen on the idea right now,” Han said.
“Vietnam is geographically closer to China and has more free trade agreements than Thailand,” he added.
Source: Nikkei Asia
