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Apple seeks to test Watch and MacBook production in Vietnam

Yahoo Finance's Akiko Fujita and Brian Cheung discuss Apple shifting production to Vietnam.

Video transcript

BRIAN CHEUNG: Apple reportedly looking to move more manufacturing into Vietnam in its latest bid to diversify its production outside of China. The Nikkei reporting two of the tech giant's suppliers have already started testing production of Apple Watches in Vietnam. Meanwhile, Apple is in talks to start testing MacBook assembly there as well. And as a reminder, Vietnam is currently Apple's second largest production hub where they manufacture iPods-- iPads, rather, and AirPods for the moment.

But Akiko, this could be big. And you do kind of wonder whether or not the lockdowns that happened in China, which I imagined kind of snagged the supply chain, were some of the factor in maybe the change in supply chain here.

AKIKO FUJITA: Yeah, you could argue the shift started even before that during President Trump's trade war with China. I mean, Apple, for a while, has been trying to diversify. Vietnam certainly a big beneficiary on the back of it. It's interesting to see the transition for Vietnam, though, because Samsung set up a huge operation there. So you already have that workforce in play. And that's kind of how these hubs begin, right? So Samsung's already been established for some time. Apple obviously moving in.

The Nikkei putting out these numbers, saying the number of Apple suppliers with facilities in the country have increased to at least 22 from 14 in 2018. So in the grand scheme of things, China is still a big hub for Apple, but this is all about diversifying their supply chain, to your point, so that when borders are shut down, they do have other avenues to tap into.