Daily Management Review

Bloomberg: Tensions between China and the US will lead to higher prices for Apple products


According to the agency, production shift from China to other nations may result in price hikes due to rising prices.

Marco Verch
Marco Verch
Technology giants like Apple are being forced to shift some of their production from China to other Asian nations as a result of US efforts to stifle China's technological development and the tense relations between the two nations. This may result in an increase in the price of the company's products, writes Bloomberg.

According to the news agency, nearly 80% of Apple's manufacturing partners today have some sort of connection to China. Meanwhile, the corporation is trying to move some production away from China into other Asian nations, primarily Vietnam and India. According to Bloomberg, "splitting the global supply chain threatens to raise prices for Apple's vast consumer base as manufacturers, carriers, and brands try to cope with production in less-settled locations," which would lead to "prestige [tech] models likely becoming more expensive to make."

None of Apple's contractors had connections to India in 2012, but as of today, at least 15 contracting firms have established production plants in India. Additionally, buyers in India will be able to purchase the iPhone 15, the company's newest smartphone model. Such a shift in strategy, however, is unavoidably going to have an impact on the price of the finished product because, in comparison to China, "such basic services as water and electricity are much less reliable" in India and Vietnam, and the country's production infrastructure is also less advanced.

source: bloomberg.com