AirPods Pro suppliers reportedly expanding production in Vietnam

Of late, Apple has been shifting a significant amount of its supply chain away from China and towards countries like Vietnam and India. As wages continue to rise in China, and in the context of the ongoing US-China trade war, the move to lower-wage economies potentially benefits Apple's bottom line and mitigates risks.

An Appleinder report indicates that Goertek and Luxshare, key Apple Airpods suppliers, are seeking capital to invest in AirPods Pro manufacturing facilities in Vietnam.

The move to Vietnam isn't a kneejerk response to the trade war. Goertek has been manufacturing Lightning cables and wired EarPods at their Vietnam facilities for several years. Trial AirPods manufacturing began in the country in July.

One possible reason for shifting production is to save on costs. The Information reports that wages in Vietnam are just 1/3 of those in China, significantly reducing production overhead for AirPods. As China becomes an increasingly expensive manufacturing location, and as factors like the trade war introduce an element of business uncertainty, we might see more production shift to neighboring countries. A case in point is Foxconn's expanding presence in India, with their Chennai facilities reportedly manufacturing iPhone XRs for the Indian market.