The Trump government will impose a 15% tariff on major products made by Apple in China, including smart watches and wireless headphones, and a tariff on Apple's most important product, the iPhone, will be implemented from December 15. (tmsnrt.rs/2Zg4zO6)
Few American companies have such close ties with China as Apple. Taiwan's Hon Hai Precision (2317.TW), Foxconn, Heshuo (4938.TW) and Weichuang (3231.TW) employ tens of thousands of workers to assemble Apple products in China.
In recent years, the maker of Apple has expanded to other countries. India, for example, did not have an Apple agent in 2015, but by 2019 it had three assembly plants, including one in Foxconn.
Apple uses Indian factories to avoid high tariffs on Chinese-made iPhones, and Apple and Foxconn have set up a factory in Brazil.
But factories outside China are smaller, and in India and Brazil, Apple's products are produced only to meet local demand. At the same time, the number of Apple-generation factories in China is much larger than that outside China. According to Apple's data, Foxconn's factories alone expanded from 19 in 2015 to 29 in 2019, and Heshuo's from eight to 12. OEMs set up these new factories as Apple added products such as smart watches, smart speakers and wireless headphones. (Chart: tmsnrt.rs/2Zg4Al8)
In addition to these factories, the rest of Apple's suppliers -- chips, aluminium shells, wiring, circuit boards and other parts manufacturers -- are increasingly concentrated in China. Data show that 44.9% of all suppliers were located in China in 2015 and 47.6% in 2019.
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