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Apple’s Vision Pro Heads into Mass Production, Boosting Mainland China’s Supply Chain Involvement

November 29, 2023
in Technology
Apple’s Vision Pro Heads into Mass Production, Boosting Mainland China’s Supply Chain Involvement
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On November 27th, Chinese media Jiemian learned from several consumer electronics supply chain companies that Apple will officially start mass production of the first generation MR (Mixed Reality) product Vision Pro in December this year. The initial batch will be around 400,000 units, with a sales target of 1 million units in 2024 and reaching 10 million units by the third year.

Different from the previous iPhone 15 series products, the proportion of made-in-mainland-China components in Apple’s Vision Pro has significantly increased to around 60%. Among them, LY iTECH has the highest proportion of domestic supply chain, exclusively supplying heat dissipation module and headband, eye mask and nose pad. The second biggest actor is Luxshare Tech, which is exclusively responsible for the assembly.

An anonymous source cited by Jiemian revealed that LY iTECH has already recruited several thousand people at a factory in Changping, Dongguan in the past six months and prepared dozens of production lines to accelerate production. However, LY iTECH did not respond to this news. Wang Laichun, Chairman of Luxshare Tech, previously stated publicly that Luxshare Precision is preparing for the upcoming launch of Apple’s Vision Pro early next year.

In the past few years, Apple’ industrial chain relocation has been heatedly discussed. According to reports from the Nikkei Asian Review, the proportion of mainland Chinese components in the cost of iPhone smartphones is gradually decreasing. For example, in the case of iPhone 15, the proportion of components provided by mainland Chinese manufacturers is only 2%.

However, since the introduction of Apple’s first-generation MR (Mixed Reality) product, Vision Pro, this year, it seems that Apple is starting to embrace the Chinese supply chain once again. 

Vision Pro is the first-generation mixed reality product released by Apple in June, 2023, and Apple has started communicating with the supply chain for the second and third generations of Vision Pro, hoping to further reduce costs and prices in order to achieve greater sales volume. 

For Tim Cook, Vision Pro represents an important milestone during his leadership at Apple. Not only consumers, but also shareholders and analysts hope that he can bring about another revolutionary products after the iPhone, following in the footsteps of Steve Jobs.

“Unlike iPhone, Chinese suppliers have been supporting companies from the beginning, but for new products like Vision Pro, the initial participation of the Chinese supply chain has significantly increased,” said the anonymous source cited by Jiemian News. 

In fact, Cook has already expressed his preference for the mainland Chinese supply chain through his two visits to China in March and October respectively. During his second visit, he also visited the local Luxshare production line, and expressed the view of Apple’s joint growth with the Chinese supply chain.

Financial Times reported that one of the key factors for Chinese supply chain companies to win Apple’s “favor” is their flexibility and strength in the development prototype stage of the Vision Pro headset, which can meet various innovative ideas proposed by Apple and turn them into reality. “What China offers is not simply labour… but an entire ecosystem of processes, built over many years. Its topography is difficult to describe, but Apple and its Chinese partners have mastered it.”

In the past few years, under the negative impact of Huawei’s chip supply cut-off and Apple’s supply chain relocation, the mainland Chinese consumer electronics supply chain has fallen into a quagmire. However, all signs now indicate that with the return of Huawei’s mobile phones to the market and the arrival of Apple’s innovative products, Chinese supply chain companies may be embracing new opportunities.

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