On April 15, Apple CEO made a surprise visit to Vietnam, drinking coffee, snacking on sunflower seeds and meeting with some content creators by Hoan Kiem Lake (Hanoi). Vietnam's role as a market and production center is increasingly important for Apple - the company is looking to diversify its production chain to minimize the risk of being affected by geopolitical friction. As soon as he arrived in Hanoi, the CEO of the "apple house" had these compliments: "There is no place like Vietnam, a vibrant and beautiful country. I am very excited to be here to connect with students, creators and customers to better understand the diversity in how Apple products are used." Last month, Mr. Tim Cook also quietly went to China to emphasize the importance of the mainland market, as well as an important part of the production supply chain for Apple. However, the recent escalation of geopolitical tensions between Washington and Beijing has forced the world's largest technology company to consider locations to restructure its production and supply chain. According to the global smartphone market report for the first quarter of 2024 by market research firm IDC, Apple's position faced serious obstacles in the first three months of this year, when it recorded a 10% decline compared to the same period in 2023. Strategic shift Last year, Apple was said to be shifting its iPad development resources to Vietnam for the first time. Component suppliers for the "apple house" have also gradually shifted to other countries outside the mainland such as Mexico, Malaysia, Thailand, Indonesia, Vietnam and India. At a working session with Prime Minister Pham Minh Chinh in September 2023, Apple Vice President of Global Policy Nick Ammann commented that “Vietnam is a very important market and production area for Apple”, and affirmed that the company “wants to participate in developing and training human resources here, especially hardware engineering”. Also at the meeting, the Prime Minister asked Apple to continue researching, expanding investment cooperation, and increasing the localization rate. At the same time, he called on Apple to play a good role as a bridge to bring US businesses and suppliers to increase investment in Vietnam, support local businesses to improve their competitiveness and participate in the global supply chain. In addition, Apple can support consulting for the National Innovation Center on building a research and development center focusing on innovation and digital transformation.

After meeting with singers My Linh and My Anh and enjoying Vietnamese drinks, Apple CEO Tim Cook went to a coffee shop on Hai Ba Trung Street (Hanoi) on the afternoon of April 15. Photo: Pham Hai

The FT reported that Apple is working with BYD, China's main iPad assembler, to move the resources needed to design and develop new products to Vietnam. Meanwhile, Chinese supplier Luxshare Precision Industry has invested in Vietnam since 2019 and is implementing projects worth hundreds of millions of dollars to build factories to produce cables, communication components, touch pens, smart location cards and smartwatches in Nghe An and Bac Giang. In addition, other Taiwanese partners of the "apple" such as Quanta Computer and Compal Electronics have factories in this Southeast Asian country. According to statistics, Apple's suppliers such as Luxshare, Foxconn, Compal and GoerTek are operating 32 factories in Vietnam, creating 160,000 jobs for the locality. Reuters reported that by the fourth quarter of 2023, Apple had completed the restructuring of 11 audio component manufacturing facilities to Vietnam - marking a strategic shift in the global supply chain. Also this month, Inventec - Apple's Taiwanese (Chinese) supplier also received a license for a high-tech project at HANSSIP (Phu Xuyen, Hanoi). Vietnamese consumers benefit JPMorgan's analysis estimates that Apple will shift 20% of iPads, 5% of MacBooks, 20% of Apple Watches and 65% of AirPods to production in Vietnam by 2025. Meanwhile, the change in Apple's approach to the Vietnamese consumer market also suggests the "upgrade" of the Southeast Asian country in the policy of one of the world's largest technology companies. In May 2023, Apple officially opened an online store in Vietnam, allowing domestic consumers to shop all products directly from the company. Vietnam is the sixth country in Southeast Asia where the Apple Store has opened an online store, after Singapore, Thailand, Indonesia, the Philippines and Malaysia. By August 2023, there was information that Apple was considering upgrading the Vietnamese market from level 3-4 to level 2. Although there was no official announcement from the iPhone manufacturer about the market ranking, the fact that the iPhone 15 series appeared here just two weeks after its announcement showed that Apple had made certain changes. Previously, Vietnamese customers had to wait four weeks for the iPhone 14 series to receive genuine products. Next, the technology giant also invested in upgrading the quality of services in Vietnam, such as opening payment via Apple Pay. The company also announced plans to collect map data in Hanoi, Ho Chi Minh City and some other provinces and cities.

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