On Monday afternoon Beijing time, Apple CEO Tim Cook posted multiple "people in Vietnam" photos on social media: tasting Hanoi's specialty egg (yellow) coffee with musicians, and taking photos with film and television creators at the famous Huanjian Lake in the area using an iPhone rear camera head.
It is obvious that as the head of a consumer electronics giant and a globally renowned supply chain master, Cook's visit to Vietnam is also related to the layout of the industrial chain.
Invested 40 trillion Vietnamese dong in the past 5 years
At the time of Cook's arrival in Hanoi, Apple announced on the Vietnamese official website that it will increase investment in the Vietnamese supply chain.
(Source: Apple Vietnam Official Website)
According to the data provided in the announcement, starting from 2019, Apple's cumulative investment in Vietnam through its supply chain partners has exceeded 40 trillion Vietnamese dong. (Note: The latest exchange rate between RMB and Vietnamese dong is 3466.83, and Apple's investment in Vietnam is equivalent to over 112 billion RMB.)
More importantly, Apple's investment speed in the local area is also accelerating, and since 2019, the company's annual investment in Vietnam has also doubled. At present, the "Apple Chain" in Vietnam has brought over 200000 jobs to the local area, including employees of Apple Inc. and local suppliers, as well as local iOS ecosystem app developers. Since 2017, the number of local software developers has tripled, and Vietnam has now become one of the top five global producers of mobile games.
It is reported that Cook will stay in Vietnam for two days during this visit. In addition to suppliers, the announcement also mentioned that Cook's visit will meet with local students, creators, and Apple users to understand how Vietnamese people use Apple products. Apple will also collaborate with suppliers to provide rainwater collection and filtration equipment to local schools, as well as renewable energy to schools in remote areas.
Vietnam's "Apple Chain" is gradually growing
Apple's investment in Vietnam can be traced back to over a decade ago. To this day, Vietnamese suppliers have become an important force in Apple's global supply chain, with many of them being subsidiaries established in Vietnam by global manufacturing giants after entering the Apple chain.
Looking at Apple's list of suppliers for the 2022 fiscal year, there are many manufacturers familiar to global investors who have set up factories in Vietnam to supply Apple, including Hon Hai Precision, BYD, Goethe AG, Intel, LanSi Technology, Luxon Precision, Samsung Electronics, LG Display, etc.
Currently, Apple's suppliers are assembling iPads, wireless headphones, watches, HomePods, and some semiconductor components in Vietnam. Previously, there were rumors that Hon Hai would assemble Macbook computers in Vietnam starting from mid-2023, but this matter has not been confirmed yet. Considering the current stagnation of iPhone sales, the upcoming major upgrades to the iPad and Mac product lines will also bear more important revenue tasks.
As the layout of the local supply chain gradually deepens, consumer business is also following suit. The company launched the Apple Store in Vietnam in May last year, and Apple Pay entered Vietnam in August. Apple is also recruiting programmers to upgrade the Vietnamese language feature of Siri's voice assistant, as well as local localization support for Vietnam on Apple Maps.
Vietnam is also one of the links in the expansion of the apple industry chain. For Apple, in addition to common advantages such as population structure and labor costs, Vietnam borders the "fruit chain stronghold" of China, and the geographical convenience also makes the supply chain connection more smooth.