As Apple seeks to broaden its manufacturing capabilities, it seems to be relying on suppliers to absorb the expenses tied to automating their production lines. Here are the specifics.
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In a unique report today, DigiTimes Asia reveals that Apple has been intensifying its focus on industrial automation as it distances itself from manufacturing in China.
The report notes that while Apple has consistently encouraged its suppliers to make investments in automation, the company “intends to strengthen implementation starting in 2025.”
Per sources within the supply chain, Apple now requires automation as a prerequisite for obtaining orders, mandating that suppliers invest in necessary equipment on their own instead of counting on Apple to finance these improvements.
DigiTimes Asia suggests that this initiative impacts “all major product lines, including the iPhone, iPad, Apple Watch, and Mac,” and while suppliers may encounter rising expenses as they ramp up their operations, this should be balanced out in the long term, with “yield rates and lower production costs.”
In essence, this signifies that while Apple aims to diversify its supply chain beyond China in light of Trump’s tariff conflicts, local workforces in other nations may not benefit, as Apple’s dependence on automation reportedly “targets diminishing labor reliance.”
Although Apple’s automation strategy isn’t unexpected, it does undermine one of the U.S. government’s arguments concerning Apple and the pressure to pull it away from China.
Here’s a comment made last April by Commerce Secretary Howard Lutnick, as the tariff battle was intensifying: “The legion of millions and millions of individuals tightening little screws to manufacture iPhones. That kind of operation is going to come to America.”
To be fair, Apple has made considerable efforts to satisfy the U.S. government with eye-catching announcements of recycled infrastructure initiatives. Nevertheless, today’s report clarifies that, irrespective of the production location, automation, not labor, will likely drive Apple’s migration from China.
