According to Nikkei Asia on Tuesday (Aug. 16), which cited sources familiar with the situation, suppliers to Apple Inc. are in discussions to build the Apple Watch and MacBook in Vietnam for the first time.

Apple Inc. is a multinational technology firm with headquarters in Cupertino, California, that focuses on consumer goods, software, and online services. As of June 2022, Apple was the greatest corporation in the world by market capitalization, the fourth-largest personal computer vendor by unit sales, and the second-largest maker of mobile phones.

Apple is the largest technological company by revenue (totaling US$365.8 billion in 2021). Together with Alphabet, Amazon, Microsoft, and Meta, it is one of the Big Five American IT firms.

Based on a source, Apple's Chinese suppliers Luxshare Precision Industry and iPhone assembler Foxconn have begun producing Apple Watch and MacBook prototypes in Northern Vietnam.

A portion of Apple's iPhone production has been moved from China to other regions, including India, where it began producing the iPhone 13 this year and where it also has plans to assemble iPad tablets. The phone is being made at a local Foxconn facility in Sriperumbudur, a town in the southern Tamil Nadu state, which is a contract manufacturer for Apple. The iPhone 13 is the company's fourth model to be produced locally since it began producing the iPhone SE in India in 2017.

India, the second-largest smartphone market in the world, as well as nations like Mexico and Vietnam are becoming more crucial to contract manufacturers providing American brands as they aim to diversify away from China in terms of production. An inquiry for comment from Reuters was not immediately answered by Apple, Foxconn, or Luxshare Precision.

After reporting profits that exceeded expectations last week, Taiwanese contract manufacturer Foxconn cautioned about the upcoming quarter, citing waning smartphone demand following a pandemic-fueled surge.

Due to strong demand for its smartphones and cloud goods, Apple supplier Foxconn announced a higher-than-anticipated 12% increase in April-June net profit. The company said it was "cautious" about the third quarter but expected improvement.

The largest manufacturer of contract electronics in the world, a Taiwanese corporation, reported that its major source of revenue, smart consumer electronics like smartphones, experienced "significant growth" in the second quarter.

Like other major manufacturers, Foxconn, formerly known as Hon Hai Precision Industry, has experienced a significant chip shortage that has hampered output as pandemic bottlenecks persisted and the Ukraine war put additional strain on logistics networks.