Apple has reportedly begun moving some of its AirPods, Apple Watch, and iPad production from China to Taiwan, as the coronavirus continues to affect the production of items in China.
Taiwan News says production of the items would join MacBook Air and MacBook Pro assembly lines that have already reportedly been moved to Taiwan. The website, a local-language report by Digitimes, has a mixed track record on its reports but has a decent record on supply chain reports like this.
Apple is trying to diversify its supply chain geographically due to the spread of the virus, which has seriously affected the production of Apple products in the communist country. Apple intends to gradually increase the proportion of production in Taiwan while still trying to maintain its cooperation with suppliers on the other side of the strait.
It is estimated that at least one-third of China’s production lines will lay idle in the first quarter of this year, and it would be almost impossible to return to the normal level of production before the end of February. It is also doubtful whether normal production could be resumed within the first ten days of March.
Companies are attempting to determine what kind of hit their Chinese production yields will take from the coronavirus, which continues to spread. The World Health Organization on Tuesday reported that there were 1,909 new cases and 98 new deaths in the preceding 24 hours, almost all of them in China. That takes the totals to 73,332 cases and 1,873 deaths. The risk assessment for China is still set to ‘Very High.’
Apple on Monday announced that it will fall short of its guidance for the March quarter due to both constrained worldwide iPhone supplies and lower customer demand for Apple products in China.
Other smartphone makers are also expected to take a hit due to the virus outbreak, as smartphone sales are expected to be at their lowest level for five years. Wearables are also expected to take a hit, likely ending up down 16% from previous expectations, while laptop shipments are expected to fall by a third.