AirPods suppliers in talks to expand production in Vietnam in line with strong demand
Apple’s trusted AirPods suppliers Luxshare Precision and Goertek are reportedly in discussions with banks to secure funding to expand production in Vietnam, according to a new report from The Information.
The production companies are seeking “hundreds of millions of dollars” to begin moving some production out of China amid continued trade tensions between the United States and China after successfully testing AirPods production in Vietnam earlier in the year.
Apple relies on Vietnam to produce wired headphones, such as the ones included in the box with new iPhone models, but never before has mass production of AirPods taken place in the country.
According to The Information, manufacturing in Vietnam is a “natural alternative” for Apple, given that Chinese components can be transported to Vietnam via land, sea, or air, and labor costs are roughly one-third of China’s.
The Apple Post reported earlier in the month that AirPods are expected to continue to grow in popularity next year, with AirPods shipments expected to hit 85 million in 2020 and revenue on track to double.
Luxshare Precision, one of three AirPods suppliers, is said to have recently been asked to ramp up AirPods Pro production thanks to strong demand from one million to two million units per month.