A Apple today published its list of suppliers [PDF] referring to fiscal year 2023. These companies represent 98% of what Apple spends directly on materials, manufacturing and assembly of its products around the world.
Despite efforts to diversify production locations — especially beyond China —, Chinese factories still dominate the list. Of the 187 companies included, 52 they are Chinese; the number is even greater than the 48 listed in the report for 2022, with the entry of 8 new partners and the exit of another 4. The number of manufacturing or development facilities for Apple products in the country has also increased, with now from 186 (10 more than in 2022).
At the same time, there was a 40% growth in the number of suppliers operating in the Vietnamwhich reached 35 (even though about 37% of them are Chinese or Hong Kong). At Thailandthe increase was about a third, reaching 24 companies. Already in India — which has been gaining importance in the manufacturing of iPhones — the number of suppliers continued to increase 14.
Still, the Tata Group — which dominates the manufacturing of Apple devices in India — appeared among Apple’s main suppliers for the first time. The company produces the rear structures of iPhones, and its presence in the supply chain is expected to increase with the acquisition of new factories.
With the Chinese in first place, Apple’s Taiwanese suppliers rank second in number of companies. The country is followed by the United States, Japan and South Korea in the Apple supply chain. Even with efforts to reduce dependence on China, it is clear how manufacturers in the country continue to be crucial for the Cupertino giant.
As highlighted by Nikkei Asia, unlike other American companies — which have been cutting their production in Chinese factories —, Apple carries out a kind of balancing policy. Even though it seeks to increase production outside the country due to disputes with the USA and security issues, China is still an important market.
Furthermore, several Chinese suppliers offer quality components at a lower cost for Apple, bringing the commercial aspect to the decision. With this importance of the Chinese supply chain, seen as more complete, diversification becomes even more complex, although it is a global trend.
Vietnam, with its energy and workforce constraints, and Thailand are the most popular destinations for technology companies and their suppliers. In India, however, foreign investment (including from Apple) has not yet taken off, with component producers — which do more than assemble devices — hoping to increase their presence in the country.
In other words: even if diversification increases, the importance of China is such that it requires great efforts for a more structural change. Another notable change in the list of suppliers in relation to last year’s survey was the exclusion of 14 companies due to minerals originating from conflicts, with humanitarian/ethical motivations.
