Market News

AAPL to Shift out of China, Eyes TSM’s Arizona Plant

Apple (NASDAQ: AAPL) is looking at shifting some of its production out of China, according to a Wall Street Journal report. The report stated that Apple has told its manufacturing partners that it wants more of its manufacturing to come out of China, particularly Vietnam and India.

The reason for Apple’s decision to move some of its production out of China has been the result of the recent unrest at the Zhengzhou production facility in China and the stringent lockdowns in the country as a result of rising COVID-19 cases.

The dependence on China for iPhones and the recent unrest there has meant the longest wait times for iPhone customers in the product’s 15-year history. According to the report, Apple iPhone customers will have to wait until after Christmas to get their hands on the newest iPhone pro models.

Indeed, Apple warned last month that “shipments of the Pro models would be hurt by Covid-19 restrictions at the Zhengzhou facility,” according to Wall Street Journal.

The report cited Ming-chi Kuo, an analyst at TF International Securities as stating that over the long term, Apple aims to ship 40% to 45% of iPhones from India, versus a “single-digit percentage currently.” The report stated that Vietnam is likely to take on more of the manufacturing of other Apple products such as AirPods, smartwatches, and laptops.

In other Apple news, according to a Nikkei Asia report, Apple and Nvidia are likely to be two of the first customers for Taiwan Semiconductor Manufacturing Co.’s (TSM) new plant in Arizona.

Analysts are bullish about AAPL with a Strong Buy consensus rating based on 24 Buys and four Holds.

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