India Gains At The Cost Of China As Apple Adjusts Supply Chain

Apple's latest supplier list shows the addition of five new mainland Chinese suppliers and the removal of eight due to pandemic-related disruptions in iPhone production during the last holiday season.

The iPhone maker's global supply chain experienced a minor adjustment as it added 18 new suppliers and cut 19, causing India to emerge as a prominent beneficiary, as reported by South China Morning Post.

Apple's production sites in India increased from 11 in 2021 to 14 last year, manifesting its rapid expansion in the country.

The company also opened its first two retail outlets in India this year, marking a significant step in its efforts to strengthen its presence in the region.

Sunny Optical Technology, metal processing companies Cathay Tat Ming and Bichamp Cutting Technology, and Zhuhai CosMX Battery were among Apple's five new suppliers in China, the report said.

Sunny Optical technology was last year's major supplier of high-end wide-angle lenses for the iPhone 14 series of smartphones.

Last week, Apple published its latest supplier list, which constitutes nearly all (98 per cent) of its spending on direct materials, manufacturing, and assembly worldwide.

The company's supply chain is typically watched closely, with any modifications perceived as an indication of China's changing role in global manufacturing.

Although the majority of Apple's manufacturing still takes place in China, the number of disclosed suppliers with facilities there has only increased by one, to 151, in 2022 compared to last year.

Due to higher labour costs, geopolitical tensions, and Covid-related restrictions in China, more companies have been relocating production to other Southeast Asian countries, such as India and Vietnam.

Covid protests erupted at the world's biggest iPhone production facility in Zhengzhou last November, causing delays in iPhone 14 shipments during the Christmas holiday shopping season.

Apple has expanded its iPhone manufacturing by including new suppliers, like Shenzhen-based Luxshare and Taiwanese Pegatron, due to concerns over excessive dependence on its largest supplier, Taiwan's Foxconn Technology.