What you need to know
- Goertek and Luxshare produce AirPods for Apple.
- The pair are reportedly trying to secure funding to expand Vietnamese production.
- This is an effort to diversify Apple's production pipelines.
Two of Apple's manufacturing partners are reportedly trying to secure funding that would allow them to increase their manufacturing capabilities in Vietnam. Goertek and Luxshare are the companies in question, with the move said to be partly down to Apple's wish to move away from its reliance on China.
The report, from The Information and via Apple Insider, says that components sourced in China would be shipped to Vietnam before being turned into AirPods. The reason? Vietnamese labor costs just a third of Chinese labor.
With Apple having reportedly asked part suppliers to help Goertek during an AirPods and Lightning cable manufacturing trial last July it seems likely that it was a success. Following that trial, Apple seems keen to move as much manufacturing out of China as possible.
Both Goertek and Luxshare are riding the crest of an AirPods-shaped wave and will likely do all they can to make sure that continues.
The two Apple suppliers—Luxshare Precision and Goertek—make a number of accessories and components for the iPhone maker, including the AirPod, which has become a hit since its first release in 2016. Both Luxshare and Goertek have benefited from strong consumer demand for AirPods, analysts say. The price of their stocks, which are traded on the Shenzhen Stock Exchange, has more than tripled since the beginning of the year.
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