Foxconn, Apple’s biggest and most strategic partner, is amplifying its move to migrate out of China. For those who have a memory lapse, Foxconn, officially Hon Hai Precision Industry Company, is a Taiwanese industrial group specialized in subcontracting for the biggest technology brands in the world. As such, it is the main assembler of Apple products. Problem: the overwhelming majority of its production capacity is in China. Since President Trump, the American authorities have put pressure on their “champions” to reduce their dependence on China. A situation that is obviously very worrying for those who do a large part of their business with a giant like Apple.
Foxconn launched in geographical diversification
The Taiwanese group has just announced its intention to invest 500 million dollars in the creation of factories in southern India. Mainly dedicated to the iPhone, these new units could manufacture nearly 25% of the range by 2025, which gives an idea of the speed of the changeover imposed by Apple on its partners. In addition to breaking out of its dependence on China, Apple is also monitoring the potential of the Indian market, where it opened its first two stores last month.
Its partner already manufactures iPhones and AirPods in its factories. Behind Apple and Foxconn, the American strategy must be observed with discernment. Thus, a few weeks ago an agreement was signed between the U.S. Secretary of Commerce, Gina Raimondo and her Indian counterpart, Piyush Goyal. The purpose of this agreement is to coordinate the subsidy policies of the two countries in semiconductors. This maneuver is part of Washington’s strategy of alliances, officially aimed at securing the chip supply chain… and above all at isolating China.
