Apple is making a major move to expand its manufacturing footprint beyond China by assigning product development resources for iPads to Vietnam for the first time. Sources tell Nikkei Asia that Apple is working with BYD, a key iPad assembler and Apple’s first partner in shifting some iPad production to Vietnam last year, to allocate new product introduction (NPI) resources for iPads in the country.
NPI involves working with suppliers on designing and developing new products and ensuring manufacturing feasibility. This critical process has traditionally taken place in China, close to Apple’s Cupertino HQ engineering teams, to tap into the country’s deep hardware manufacturing expertise.
NPI requires heavy investments of resources from both the device company and suppliers. Having NPI in Vietnam signals the country is becoming a full-fledged alternative to China as a core manufacturing base beyond just assembly. With geopolitical uncertainties around China, Apple has been aggressively expanding production in India and Vietnam. Earlier reports showed the company plans to shift some iPhone NPI work to India as well.
According to Counterpoint, only around 10% of iPads are currently made in Vietnam. But the country has emerged as the most critical manufacturing hub for Apple outside China, with the company asking suppliers to build capacity in Vietnam for nearly all devices except iPhones. Analysts say having overseas NPI demonstrates non-China hubs can truly stand in as alternative manufacturing sites, even though Apple will continue working closely with Chinese suppliers amid its supply chain diversification.
