News Forum - Apple plans to move production out of China and into Thailand

[Thaiger]

Apple Inc. plans to move production out of China, by far the dominant country the company’s supply chain. Suppliers are being to asked plan for moves elsewhere in Asia, particularly India, Thailand and Vietnam, to reduce the influence of Foxconn Technology Group. In a series of tweets, analyst Ming-Chi Kuo said the main production location outside of China for Apple’s future MacBooks may be Thailand. Kuo noted that Apple’s entire range of MacBook Air and MacBook Pro models are currently assembled in Chinese factories. Turmoil at a iPhone City – giant city-within-a-city in Zhengzhou, China, saw as many as 300,000 workers […]

The story Apple plans to move production out of China and into Thailand as seen on Thaiger News.

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[HolyCowCm]

Well that is a good step in the right direction and gives a thumb to the nose for to the CPP and XI. Bad for the good honest working Chinese folk, but a plus for taking all of their apples out of the one basket. Let's hope more companies follow and more other countries step up and help make production in their country competitive and top end quality. 

[Haole.TH]

Apple's QA will be very different in Thailand.  Different level / mentality of people in Thailand.  I hope Apple factored in the size / quantity of brown envelope's here.

A better option would be Vietnam ... 

[HolyCowCm]

1 minute ago, Haole.TH said:

Apple's QA will be very different in Thailand.  Different level / mentality of people in Thailand.  I hope Apple factored in the size / quantity of brown envelope's here.

A better option would be Vietnam ... 

Thailand is also getting expensive as they stupidly keep on increasing workers wages. Automation is what more and more are looking for now here as a people workforce alone cannot sustain itself. Vietnam is a good option and they are very competitive, but China is one hard cookie to beat with low costs. Not saying it cannot be done, but I always think of how they keep lowest prices, and I come to the conclusion alot that the CCP fund many things secretly under the table in order to keep that advantage. 

[Khunmark]

27 minutes ago, HolyCowCm said:

Thailand is also getting expensive as they stupidly keep on increasing workers wages. Automation is what more and more are looking for now here as a people workforce alone cannot sustain itself. Vietnam is a good option and they are very competitive, but China is one hard cookie to beat with low costs. Not saying it cannot be done, but I always think of how they keep lowest prices, and I come to the conclusion alot that the CCP fund many things secretly under the table in order to keep that advantage. 

What’s the rationale for the claim you make in the first sentence?

[Poolie]

30 minutes ago, HolyCowCm said:

Thailand is also getting expensive as they stupidly keep on increasing workers wages. Automation is what more and more are looking for now here as a people workforce alone cannot sustain itself. Vietnam is a good option and they are very competitive, but China is one hard cookie to beat with low costs. Not saying it cannot be done, but I always think of how they keep lowest prices, and I come to the conclusion alot that the CCP fund many things secretly under the table in order to keep that advantage. 

Speechless..................

[Soidog]

4 minutes ago, Poolie said:

Speechless..................

Well you would be. You live in China, so that’s an important lesson you have learned. If you could also give up the typing as well, then that would be just great. 

[HolyCowCm]

25 minutes ago, Khunmark said:

What’s the rationale for the claim you make in the first sentence?

First hand seeing the price increase here opposed to doing business from Vietnam or knowing the China market as well. Can only go so high before manufacturers and buyers turn to another country. Easy as that.

[HolyCowCm]

24 minutes ago, Poolie said:

Speechless..................

Just the truth of the matter and how it is. Know this first hand from the food industry..

[Rookiescot]

53 minutes ago, Poolie said:

Speechless..................

Yes because the CCP have not given you an official line to take on this story yet 

[Grumpish]

Quite possibly the first of many, who will be the next high profile player to, if not pull out of China completely, at least diversify? 

[kalyan]

In my opinion the apple will stay in china, this is a threat call so as china and foxconn will wake up to keep up the business.

[Shade_Wilder]

 

In the late 90s/early 2000s, the West and other countries on the planet made a policy decision regarding China; clearly it was growing at an astounding rate and clearly was going to continue to do so for a long while as it started from such a low beginning. And, by the way, I think that was/is a good thing as millions and millions of people were raised out of poverty.

There were essentially two options.

Option #1, allow China to join the WTO and begin trading on a large scale so that it became a 'stakeholder' in a stable global economic order and worked to enhance, improve and support a global set of rules for commerce.

or

Option #2, continue an informal policy of stymieing China's growth and continuing a policy that attempted to limit China's economic progress and prowess.

Yes, a wee bit of an oversimplification, but those were the general options. The West and other countries chose option #1 which I think was the correct decision then and still think was the correct decision; having China inside a rules-based global trading system makes a lot of sense and efforts to keep it out were not sustainable. 

However, the assessment or assumption that China would become a rules-based member of a global economic systems was flawed; in its simplest form, China hasn't played by the rules and steps need to be taken to rectify this. It is and should be a slow, gradual process to either enhance China's participation in the system or slowly and gradually ease them out. I say 'slowly and gradually' for a couple of reasons; China is a 'testy', overly Nationalistic country and needs to handled tactfully. No matter how integrated the Chinese and Others' economies intertwine in the end, there will be links and best to keep them on good terms. And, I still think the policy is generally correct; having the countries of the world get along inside a set of workable rules is a good thing.

I think both China and the West and Others will need to make some decisions soon.

Will China want to be part of a global order, act as a stakeholder and work within a system? Or, not?

Will the West and Others want to continue trying to integrate China into a Global system, or will they just give up and disentangle from China?

These will be some very consequential decisions.

 

[HolyCowCm]

57 minutes ago, Shade_Wilder said:

Will China want to be part of a global order, act as a stakeholder and work within a system? Or, not?

Will the West and Others want to continue trying to integrate China into a Global system, or will they just give up and disentangle from China?

These will be some very consequential decisions.

Depends. Not sure CCP can reverse what they have strung out in their webs. At least not in time before many pill their anchors and jump out. Can the fraction of the good people of China dislodge XI from his ego high horse iron red fist of fat headed control? XI needs to go before the country can turn a different way. And I don’t see that happening. Seems everyone in their government system are professional liars and the world has woken up to their BS and takeovers. 

[Marc26]

2 hours ago, Shade_Wilder said:

In the late 90s/early 2000s, the West and other countries on the planet made a policy decision regarding China; clearly it was growing at an astounding rate and clearly was going to continue to do so for a long while as it started from such a low beginning. And, by the way, I think that was/is a good thing as millions and millions of people were raised out of poverty.

There were essentially two options.

Option #1, allow China to join the WTO and begin trading on a large scale so that it became a 'stakeholder' in a stable global economic order and worked to enhance, improve and support a global set of rules for commerce.

or

Option #2, continue an informal policy of stymieing China's growth and continuing a policy that attempted to limit China's economic progress and prowess.

Yes, a wee bit of an oversimplification, but those were the general options. The West and other countries chose option #1 which I think was the correct decision then and still think was the correct decision; having China inside a rules-based global trading system makes a lot of sense and efforts to keep it out were not sustainable. 

However, the assessment or assumption that China would become a rules-based member of a global economic systems was flawed; in its simplest form, China hasn't played by the rules and steps need to be taken to rectify this. It is and should be a slow, gradual process to either enhance China's participation in the system or slowly and gradually ease them out. I say 'slowly and gradually' for a couple of reasons; China is a 'testy', overly Nationalistic country and needs to handled tactfully. No matter how integrated the Chinese and Others' economies intertwine in the end, there will be links and best to keep them on good terms. And, I still think the policy is generally correct; having the countries of the world get along inside a set of workable rules is a good thing.

I think both China and the West and Others will need to make some decisions soon.

Will China want to be part of a global order, act as a stakeholder and work within a system? Or, not?

Will the West and Others want to continue trying to integrate China into a Global system, or will they just give up and disentangle from China?

These will be some very consequential decisions.

You always have interesting and informative posts, I always enjoy your thoughts on things, even if I don't agree with them.............

[TedG]

This is good news for Thailand.  

[Skip]

56 minutes ago, TedG said:

This is good news for Thailand.  

And bad news for Apple quality control

[EdwardV]

15 hours ago, HolyCowCm said:

Let's hope more companies follow and more other countries step up and help make production in their country competitive and top end quality. 

Yo be fair, Apple is one of the last majors (Germans excepted) to start relocation plans. 
 

 

15 hours ago, HolyCowCm said:

but China is one hard cookie to beat with low costs.

That was true. Now not so much. When China started industrializing 30 or so years ago its labor cost was about 10x less than Mexico.  Now it’s 2x more. There isn’t a single product that can’t be made cheaper somewhere else. The only reason others haven’t left is the sunk cost in facilities. 
 

12 hours ago, Shade_Wilder said:

However, the assessment or assumption that China would become a rules-based member of a global economic systems was flawed; in its simplest form, China hasn't played by the rules and steps need to be taken to rectify this.

This entire post is so spot on.

[HolyCowCm]

3 hours ago, EdwardV said:

Yo be fair, Apple is one of the last majors (Germans excepted) to start relocation plans. 
 

That was true. Now not so much. When China started industrializing 30 or so years ago its labor cost was about 10x less than Mexico.  Now it’s 2x more. There isn’t a single product that can’t be made cheaper somewhere else. The only reason others haven’t left is the sunk cost in facilities. 
 

This entire post is so spot on.

There is an ongoing underlying suspicion that many things say like in the food industry having foods sent to the US are secretely under the table funded by their masters. I stay well informed of agricultural products pricing from that country. Extremely hard to match from any other country.

[TheDirtyDurian]

9 hours ago, Skip said:

And bad news for Apple quality control

The massive car industy, and Japanese electrical firms would disagree with you.....