Apple Relocates Many Devices to Taiwan

Second different sourcesApple has already started the process of transferring the production of AirPods, iPads and Apple Watches from China to Taiwan to try to remedy the coronavirus problem.

From China to Taiwan

With this move, Apple is speeding that up supply diversification process already started a couple of years ago mainly in India. The coronavirus epidemic in China has almost forced the company to move as soon as possible to avoid a slowdown – if not an interruption – of all the production of its devices. Some factories in China have already reopened and are assembling various iPhone models (including the possible iPhone 9), although very slowly. For other devices, Apple would have decided to rely on several partners in Taiwan so as to avoid any future problems.

The demand for AirPods, iPad and Apple Watch does not seem to slow down, which is why Apple is forced to provide as many devices as possible in order to avoid slowdowns in deliveries.

In fact, it is estimated that at least a third of Chinese production lines will remain inactive in the first quarter of this year and it would be almost impossible to return to normal production levels by the end of February. Nor is it sure that production will restart at full speed by mid-March.

Moving assembly work from China to Taiwan will help Apple, but it will not be a permanent and lasting solution since many components are manufactured in China. If the epidemic continues for a long time, manufacturers in Taiwan will also run out of components.

The good news

Several analysts very close to manufacturing issues in China believe however that the situation could recover when before, adding that the consequences for Apple will not be so serious. Analysts believe that Apple’s long-term outlook has not changed, although there may be an impact during the first and second quarters of the year.

In short, already in the summer Apple should restore its production line and recover with greater sales any devices not shipped due to the lack of units.


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