SAN FRANCISCO (KCBS) — According to a new report, Apple Inc. is considering boosting the production of its products in markets outside of China due to the nation's strict anti-COVID policy, among other reasons.
Apple reportedly told some of its manufacturers that they were planning on making the move, according to people in the discussions, the Wall Street Journal reported.
Among the sites that could be getting a boost in production include India and Vietnam, which already make up a small portion of the company's global production.
The Journal reported that more than 90% of Apple's top products are made in China by outside contractors, but analysts have warned that Apple's dependence on the country is a potential risk.
Several companies could follow Apple's lead if it decides to move some of its production out of the country, and China's decision not to criticize Russia's war on Ukraine is also playing a part.
Since the war in Ukraine began, Russia has been condemned by companies in the West who have decided not to do business in the nation anymore.
But when it comes to the supply chain, the risk of potential lockdowns in China, like the ones seen across the country, left Apple CEO Tim Cook looking to give confidence in its manufacturing capabilities.
"Our supply chain is truly global, and so the products are made everywhere." Cook said in April while adding that they "continue to look at optimizing."
Apple shared in April that lockdowns and a resurgence in COVID-19 could cost the company $8 billion in sales this quarter alone, the Journal reported.
The decision to try and distance itself from China and add production sites elsewhere has been in the works for some time at Apple, looking to do so before the COVID-19 pandemic.
But after the pandemic derailed those plans, Apple is finally back at it telling contractors where they should be looking to build new manufacturing capacity, according to the report from the Journal.
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