Because Apple opened an institute to incubate the new generation to learn technology that is in line with the expansion of its business in those countries.
This is all part of the China Plus One strategy of many companies that are beginning to fear China’s uncertainty.
This strategy for Apple means transferring part of its production from China to neighboring ASEAN countries.
Because the Chinese economy began to encounter real estate problems. and lessons from the COVID period This causes companies to “reduce risk” by diversifying their investments to other countries.
Vietnam and Indonesia are the two countries chosen by Apple.
Tim Cook says Apple will focus more on Vietnam and expand relationships with suppliers or supply chains in the country and invest more in the region
The key event that forced Tim Cook to reconsider its strategy came in 2022, when a major Apple supplier, Foxconn, closed its factories due to the COVID-19 outbreak.
It was a time when China had a strict epidemic control policy. causing production plans to be affected This is aggravated by labor problems when workers protest that their employers are being too strict.
That production disruption resulted in a shortage of about 6 million iPhones.
This causes Apple to lose a huge amount of revenue.
After the incident, Apple began looking at ways to diversify its supply chain to other countries in the region.
Vietnam and India have become key destinations for expanding operations for key products including AirPods, Apple Watch and, most recently, iPad.
Another reason that is consistent with moving to Vietnam. That’s because many of Apple’s key suppliers, such as Foxconn and Luxshare, also have strong presence in that country.
Since 2019, Apple has invested approximately $16 billion to set up production in Vietnam.
Another important reason why major companies have had to adjust their plans is because of tensions in relations between the United States and China.
In addition, the US government Bans Chinese companies from accessing advanced semiconductor technology This is coupled with accusations that China has flooded the markets of other countries with cheap products in some sectors. It made the tension level even higher.
And what cannot be overlooked is that Apple is also facing declining sales in China. because of competition from Chinese brands And because the economy has weakened, the purchasing power of the Chinese middle class has weakened as well.
iPhone sales shrank 24% compared to last year.
This is because of declining sales combined with increased competition from Chinese smartphone brands. As a result, iPhone shipments fell 10% in the first quarter of this year.
That means Apple has lost its position as the world’s top smartphone seller to Samsung.
It can be concluded that Vietnam is becoming more important to Apple as the company tries to diversify its supply chain away from China.
Tim Cook met with Vietnamese Prime Minister Pham Minh Trinh to reinforce his policy to continue expanding investment in that country.
In a press conference, Tim Cook said, “There is no country like Vietnam. Because it is a lively land with beautiful nature.”
It added that Apple’s investment in Vietnam has doubled since 2019.
Tim Cook is actively engaging with the new generation. Be it students, programmers, and social media content creators.
In fact, Apple began its foray into Vietnam more than a decade ago. and to date, more than 200,000 jobs have been created there.
Today Vietnam has become one of the top five mobile game producers in the world.
Vietnam has long been a base for Apple’s investments, with 26 suppliers and 28 factories in Vietnam.
Most are located in the northern provinces. which can be easily connected to existing supply chains in southern China.
Northern Vietnam was also a former center for electronics manufacturing and had cheap skilled labor.
From Vietnam, Tim Cook also flew to Indonesia to talk with President Joko Widodo about expanding investment there.
Indonesia is Southeast Asia’s largest economy.
“We talked about the president’s desire to see domestic production. And that’s a topic we’re considering,” Tim Cook told reporters after meeting with the Indonesian leader.
“The potential to invest in Indonesia is endless. There are many great places to invest and we are investing,” he added.
But details of the investment plan in any specific area were not given.
But a day earlier, Apple had announced plans to promote investment in Indonesia. It will begin with the opening of the country’s fourth Apple Developer Academy in Bali.
The institute aims to nurture tech talent in the country’s growing iOS app economy. It focuses on teaching coding and design.
Indonesian Industry Minister Agus GumiwangKartasasmita said Apple has invested a total of 1.6 trillion rupiah (about 3.5 billion baht) in four institutions in Indonesia.
The Indonesian government has asked Apple to establish two more educational institutions. One is in eastern Indonesia. and another in the new capital on the island of Borneo.
Indonesia to move capital from Jakarta to Nusantara in August
President Jokowi asks Tim Cook to join the project “Smart City” in the new capital as well
Indonesia recently issued new rules requiring companies to increase the proportion of parts made in the country to boost the country’s production.
As of 2022, the government has increased the amount of domestic parts and components Apple requires in its smartphones to 35% of that year’s value.
This increased from 20% in 2016.
For the reason that software must meet local procurement requirements, Apple has set up training bases across the country since 2018.
The latest announcement comes as a response to higher domestic procurement ratios.
Domestic software purchasing is calculated based on various factors. including design Intellectual property rights and employment as well
Today, Apple has an 11.57% share of Indonesia’s mobile phone market.
According to Statista’s January data, the market leader is Oppo with a share of nearly 18%.
Followed by Samsung at approximately 17.44%.
Does all this explain why Tim Cook didn’t stop in Thailand?
Or does the Thai government still need a deeper and broader analysis than this…to tell the Thai people that
Vietnam, Indonesia, what do we not have in Thailand?
