What you need to know
- Apple is moving some iPad production away from China.
- It will move some production to Vietnam, the first time its tablet has been made outside of China.
- Strict COVID lockdowns in China are disrupting supply.
Apple is to move some iPad production away from China and into Vietnam because of COVID lockdowns that are disrupting supply, according to a new report.
From NMkkei Asia:
For the first time ever Apple is moving some iPad production out of China and shifting it to Vietnam after strict COVID lockdowns in and around Shanghai led to months of supply chain disruptions, Nikkei Asia has learned.
The report says that one of Apple's "leading iPad assemblers" has helped Apple build production lines in Vietnam and could soon start making a small number of Apple's best iPads in the region.
Apple has also reportedly asked suppliers to start stockpiling inventories to guard against future shortages. The report says Apple has long-considered iPad production in Vietnam but that this move was delayed by COVID in Vietnam. It is the second major product line to be made in Vietnam after AirPods.
The report says Apple is asking suppliers not hurt by lockdowns to build up additional supplies of some components including chips for the new iPhone 14:
In particular, Apple is asking suppliers outside of the lockdown-affected areas to help build up a couple of months' worth of component supplies to ensure supply continuity over the next few months. The requests apply to all of Apple's product lines -- iPhones, iPads, AirPods and MacBooks -- sources said.
Many factories that help supply Apple in China are currently under strict COVID measures to help prevent the spread of the virus in China, with factories operating "closed-loop" systems on campus to stop workers from moving away from factories or accommodation.