Apple's biggest contract manufacturer Foxconn has secured a new site in Vietnam, amid the Taiwanese giant's attempt to shift production away from China after facing major supply-chain disruptions late last year due to the country's zero-Covid policy, the media has reported.
According to a report by South China Morning Post, Taiwan-headquartered Foxconn (earlier known as Hon Hai Precision Industry Co. Ltd.) has signed a lease with Saigon-Bac Giang Industrial Park Corp to occupy a plot of 45 hectares for around $62.5 million to meet "operational needs and expand production capacity".
In an exchange filing, the Taiwanese manufacturing giant said the lease will run through February 2057.
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"Foxconn signed a $300 million agreement with a Vietnamese developer last August to build a new factory in Bac Giang, where it already produces iPads and AirPods," according to the report.
Foxconn is also planning to increase its workforce at its plant in India over the next two years. The company had announced a $500 million investment in its Indian subsidiary in December last year.
Foxconn's biggest iPhone manufacturing facility in China, hit hard by Covid-related disruptions, gradually recovered and production reached about 90 per cent of maximum capacity in early January.
Foxconn Technology Group's facility in the central Chinese city of Zhengzhou is the world's largest iPhone factory, which saw major disruptions in the last three months of 2022 caused by the pandemic controls.
Meanwhile, Apple's bid to shift production from China to India has been hit by challenges, a report by the Financial Times said recently. Apple currently locally assembles the iPhone 14 and iPhone 14 Plus in India. Apple's move of moving production away from China after the country's strict COVID-related restrictions dented supply chains across industries and as trade and geopolitical tensions between Beijing and Washington escalated.