Apple tells suppliers it wants more production in India and Southeast Asia, outside of China

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Apple Inc. has told some of its contract manufacturers that it wants to boost production outside China, citing Beijing’s strict anti-COVID policy among other reasons, people involved in the discussions said.

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India and Vietnam, already sites for a small portion of Apple’s AAPL,
+0.17%
global production, are among the countries getting a closer look from the company as alternatives to China, the people said.

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More than 90% of Apple products such as iPhones, iPads and MacBook laptops are manufactured in China by outside contractors, according to analysts. Apple’s heavy dependence on the country is a potential risk because of Beijing’s authoritarian Communist government and its clashes with the US, analysts have said.

Any move by Apple, the largest US company by market capitalizationto emphasize production outside China could influence the thinking of other Western companies that have been considering how to reduce dependence on China for manufacturing or key materials. Such consideration has stepped up this year after Beijing refrained from criticizing Russia for its invasion of Ukraine and carried out lockdowns in some cities to fight Covid-19.

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An expanded version of this report appears on WSJ.com,

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