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Apple Needs China

Peter Kafka, writing at Recode:

Unlike tech companies that haven’t broken into the country or only do minor business in it, Apple is now so deep in China that leaving it could be catastrophic. Even if the company was willing to forgo the $44 billion a year in sales it makes in China, it can’t leave the deep network of suppliers and assemblers that build hundreds of millions of iPhones every year.

Earlier this year, in response to the escalating US-China trade war, Apple floated the idea that it could move some of its production outside of China to hedge its bets. But it was only willing to suggest that it would move a third of production.

So even if Apple decided to make the wrenching decision to get out of China today, it couldn’t. It is stuck there, for better and for worse.

Friday, 11 October 2019