Staff or Guest writer for The Dog of Wall Street.

2020-11-27 16:44

Apple Inc. (AAPL) has asked its manufacturing partner Foxconn to relocate some iPad and MacBook production capacity to Vietnam, according to multiple reports surfaced Thursday.

Foxconn is expected to shift manufacturing operations related to the aforesaid devices in the first half of 2020. It has reportedly selected Bac Giang province of Vietnam for the purpose. The latest move comes as Cupertino, California-based Apple looks to diversify its supply chain to limit the potential risks associated with the U.S-China trade war. 

Many manufacturers have shifted their production operations from China to other countries in recent years to avoid side-effects of political tensions between the two biggest economies of the world. Most of the production lines were relocated to countries including Mexico, India, and Vietnam during the Trump era.

In the case of Apple, many of its production partners have scaled up iPhone manufacturing capacity in India, while those assembling AirPods have relocated some manufacturing operations in Vietnam.

Separately, Foxconn recently announced to spend $270 million in new investment, which according to some reports are intended for building production facilities in Vietnam.

However, the percentage of overall production operations that Foxconn wants to relocate is still unknown. But some reports stated that the Taiwanese company is planning to shift 30 percent of its production capacity outside China. 

Apple (NASDAQ: AAPL) stock has ended the week at $116.59 on Friday. Overall, the stock has performed well this year. However, it stayed flat over the past three months. Its share price has increased nearly 58 percent on a year to date basis, and about +47 percent over the past 6 months. Though, the stock has slipped over 8 percent during the last three months.

Disclaimer: I have no positions in any of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I have no business relationship with any company whose stock is mentioned in this article. All information should be independently verified and should not be relied upon for purposes of transacting securities or other investments. See terms for more info.