Why the China-Taiwan crisis could delay the release of Apple smartphones

iPhone 14 production faces a last-minute hurdle. Tensions between China and Taiwan are disrupting Apple’s supply chain. Could some iPhone models be delayed as Chinese customs tighten the screws?

Apple just messed up Conflict between China and Taiwan. According to prominent business daily Nikkei, the Cupertino giant would ask its Taiwanese suppliers to respect Chinese import regulations.

China requires that all components manufactured in Taiwan be stamped “Taiwan, China” Where “Taipei, China”. With this seemingly innocuous rule, the Chinese regime wants to remind that the island belongs to it.

The measure, which was introduced a few years ago, has not been systematically applied by companies in Taiwan. However, following Nancy Pelosi’s controversial visit, the president of the US House of Representatives, Beijing toughened the tone. At the same time, China organized military exercises around Taiwan. These maneuvers continued beyond the intended date. Operations involving maneuvers “Real Shot”Despite the resistance of Western countries, it is still going on.

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Components blocked by Chinese customs

according to “ sources familiar with the matter » Asked by Nikkei, Apple fears that there are components that do not comply with Chinese laws blocked by customs. Products marked “Made in Taiwan” may not arrive in time to Chinese factories that are Apple partners, such as Pegatron or Foxconn. A few days ago, components in transit from Taiwan to China were also examined.

The situation is further complicated by the fact that Taiwanese law conflicts with Chinese law. Ada requires labels to carry terms instead “Taiwan” Where “Republic of China”.

Apple is heavily dependent on components made in Taiwan. The Californian giant especially trusts Chips etched by TSMC. After the chips are engraved, they are sent directly to Chinese factories that assemble iPhones and other branded devices. To prevent a security breach, Apple asked its suppliers to quickly change labels on boxes and uniforms for shipments from Taiwan to China.

iPhone 14 production faces a new hurdle

This geopolitical crisis comes at a very bad time for the American giant. Chinese factories are currently completing mass production of the brand’s new high-end smartphones, the iPhone 14. However the presentation keynote is fast approachingApple cannot afford any delays.

It should be noted that the production of iPhone 14 has overcome many obstacles during the last few months. Apple’s production lines especially suffered from computer chips and shortages The resurgence of the coronavirus in China. Faced with this outbreak, Chinese authorities adopted a series of protective measures last spring. Several factories were forced to close for a while.

Despite these pitfalls, Apple managed to catch up this summer. The impact of these failures would be absorbed. Unfortunately, the Taiwan-China crisis could cause further disruption. It is not impossible that the production of certain models, including the iPhone 14 Max, which is already experiencing screen problems, will be delayed.

If the odds were up, Apple theoretically could release some iPhones a few weeks late on the usual schedule. The brand already did this in 2020 with the iPhone 12. The range was launched with a delay of several weeks between models. Apart from the surprise, the main release will always be in early September. Bloomberg journalist Mark Gurman says in his Sunday newsletter that Apple has also started recording the presentation video.

Apple is heading to India

In this context, Apple will make every effort Reduce dependence on China. In recent years, the group has moved a significant part of iPhone production to India. A Foxconn factory has been opened in India as part of an agreement with the local government.

My latest survey shows that Foxconn’s iPhone manufacturing site in India will ship the new 6.1-inch iPhone 14 for the first time in the second half of 2022, almost at the same time as China (India is a quarter or so behind in the past). .

— 郭明錤 (Ming-Chi Kuo) (@mingchikuo) August 5, 2022

This summer, Foxconn has an Indian plant increased production capacity At Apple’s request. More iPhones can be assembled at the Factory. According to Ming-Chi Kuo, a financial analyst specializing in Apple products, the factory will produce some of the standard iPhone 14s. This is the first time that the first batch of iPhones has been produced outside of China.

“This is an important step for Apple in establishing an iPhone production site outside of China. This means that Apple is trying to reduce the impact of geopolitical issues on supply and sees the Indian market as its next engine of growth.Ming-Chi Kuo explains.

Source:

Nikkei