Briefing: Apple assesses moving up to 30% of production out of China

Briefing: Apple assesses moving up to 30% of production out of China

Briefing: Apple assesses moving up to 30% of production out of China

Apple Inc. urged the Trump administration not to proceed with tariffs of as much as 25 percent on a new slate of products imported from China, saying it would reduce the company's contribution to the USA economy. Apple has decided the risks of relying so heavily on manufacturing in China, as it has done for decades, are too great and even rising, several people told Nikkei. This is not just for Apple's iPhone key suppliers such as Foxconn, but as well as its Macbook and AirPods suppliers to evaluate options out of China. In Apple's letter to Robert Lighthizer, US Trade Representative, the corporate argues that the proposed tariffs, which might impression nearly each Apple gadget together with the iPhone, MacBook, AirPods, and Apple Watch, would harm Apple's US workers and its means to contribute to the US economic system.

The countries being considered for diversification include Mexico, India, Vietnam, Indonesia and Malaysia.

Apple's manufacturing partner in Taiwan, Hon Hai Precision Industry, or Foxconn, can be relied upon to turn out enough iPhones to satisfy the requirements of Apple's United States market outside China, says Bloomberg.

It comes a week after reports that Apple was preparing to move production outside of China if the trade war escalates. The Cupertino-based company is looking to move as much as 30% of its iPhone production of the country.

This is the first time Apple has specifically mentioned the iPhone on a list of products that would be impacted by tariffs. Wedbush analyst Daniel Ives said that "in a best-case scenario", Apple would likely be able to shift 5% to 7% of its iPhone production to India within 12 to 18 months.

Back in May, China vowed to reciprocate President Donald Trump's plan to hike tariffs on products imported from China, threatening to impose a 25% tariff on USA goods.

The Cupertino, California-based technology giant made the plea in a letter to US trade representative Robert Lighthizer this week.

"Twenty-five percent of our production capacity is outside of China and we can help Apple respond to its needs in the USA market", Liu said a few weeks ago.

FILE PHOTO: A woman looks at the screen of her mobile phone in front of an Apple logo outside its store in Shanghai, China July 30, 2017. Apple declined to comment when contacted by Nikkei.

Additionally, the company said the plan would "weigh on Apple's global competitiveness" and effectively boost its Chinese rivals.

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