Apple is losing a near $20 billion join venture in India that would have partnered it with Foxconn, a major chip supplier of semiconductor and display components.
Apple is trying to reduce risk with having less suppliers, but I don't think Apple will be able to do this fast. Apple is very reliant on external suppliers for its materials.
Foxconn has determined that it will not do a joint venture with Apple in India, according to Reuters. This is a difficult thing for the Indian primer minister as this would have brought a lot to the Indian economy. It's also a big blow to Apple as well.
Apple wants its suppliers to diversify their supply chains outside of China's mainland and for good reason. China is a single point of failure and if things go bad there, then it's no good for a company getting its materials there.
The Break Up
The break up is the removal of this joint venture and nearly $20 billion for Apple, but I don't think Apple will be mourning this break up for very long. Apple has an enormous pile of cash and war chest, but this break up should at least be a wake up call.
The United States government and other technology companies are starting to openly communicate that Chinese technological advancements and manufacturing dominance is a key threat to national security.
More companies should do what Tesla is doing and make most of their components here in the U.S. Tesla is leading the way there.
Apple will be fine though, so long as they start manufacturing in the U.S. Do you think Apple will be fine?
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