Apple is determined to be less dependent on China to manufacture its products.
The Cupertino-based tech giant's Indian supplier, Jabil, has begun making components for AirPods in the country as part of Apple's expansion in India and its efforts to be less dependent on Chinese manufacturing.
Apple has been expanding and diversifying its supply chain for its devices since mid to late 2022, with India being its prime target due to it being the second-largest smartphone market in the world, per Statista.
Apple-Jabil AirPods Component Manufacturer Details
Apple is not slow on the uptake. According to Bloomberg's sources, the Indian unit of Jabil Inc. had already begun shipping AirPods enclosures, commonly known as the device's plastic bodies, to China and Vietnam, where the wireless earphones are assembled.
The sources also mentioned that Apple's move to have Jabil's Indian unit manufacture and ship the AirPods' plastic bodies is not meant to be known to the public, and as such, they asked to remain anonymous and unnamed.
Meanwhile, Jabil representatives nor Apple didn't respond to Bloomberg's request for comment regarding its sources' information.
Regardless, Apple's move is a boon to Jabil and India. The company operates an 858,000-square-foot facility that employs 2,500 workers to help manufacture customers' needs.
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Meanwhile, Indian Prime Minister Narendra Modi made it a national priority to grow the country's manufacturing sector, providing companies with financial incentives and government support to bring their manufacturing business to India.
Neil Shah, vice president of research at Counterpoint, mentioned that making AirPods' plastic bodies is typically the first step for full-fledged production of the end-product in India, especially since Apple won some suppliers' initial approval, which includes Luxshare Precision Industry Co. Ltd., one of the company's Chinese suppliers which makes AirPods.
Apple's Moves to Diversify Its Supply
These subsidies and government support worked well with Apple, as it remains the world's largest producer of so-called true wireless stereo devices, a category that includes earphones and headphones.
In terms of expansion and diversification, this move is another step in Apple's plans to shift its manufacturing away from China, per Reuters.
The tech giant has good reason to shift its production elsewhere. You may remember the effects of the zero-COVID policy the Chinese government imposed in the country to stem the rising COVID-19 cases during the last few months of 2022.
This policy, along with the subsequent civil unrest due to its effects and the death of many people in Xinjiang due to a fire that could've escaped, per CNN, negatively affected Foxconn's iPhone production.
Additionally, the ongoing trade war between the US and China, along with the many tech-related bans the former imposed on the latter, is providing Apple with more reasons to diversify its supply chain.
Currently, Apple is looking to make India the supplier of up to 25% of its production from its current 5%-7% of all its devices.
