China alternative: Apple Supplier BYD Aims to Make Tablets in Vietnam From June

Apple Inc. supplier BYD plans to begin production of tablets in north Vietnam as early as this month, according to a government notice, a boost for a country expected to benefit as electronics manufacturers seek alternatives to China.

Officials at the Phu Ha Industrial Park in December granted BYD a construction license to build a 6.23 trillion dong ($268 million) factory, according to a statement posted on the website of Phu Tho province. The plant will have the capacity to make 4.33 million tablets a year from as early as June 2022, according to the statement. BYD, which now assembles iPads mostly in China, will also be able to produce 50 million units of optical glass a year.

It’s unclear whether the figures were preliminary estimates, and the notice didn’t specify iPads. Representatives of BYD in Vietnam were not immediately available for comment, while calls and emails to the company’s Shenzhen headquarters went unanswered after regular hours.

Apple suppliers with large production bases in China began considering shifting capacity to Southeast Asia after tensions between Washington and Beijing escalated, a shift that pandemic-era upheaval is expected to accelerate. This year, a series of lockdowns from Shanghai to Shenzhen have cast supply chains in disarray, exposing the fragility of a system that depends on China to make the majority of the world’s electronics.

Apple estimates Covid restrictions in China and other supply constraints will cost the company as much as $8 billion of sales. The company now plans to shift some iPad production to Vietnam from China, the Nikkei reported June 1. BYD could begin iPad production in the Southeast Asian country soon, Nikkei said.

Vietnam’s government said in January 2021 that Foxconn Technology Group -- Apple’s most important production partner -- planned to invest $700 million in the country that year. The northern province of Bac Giang granted a $270 million investment license to its unit Foxconn Singapore to produce laptops and tablets, officials said.