Thanks to the pandemic, Apple and Google cannot move the production of some devices to Vietnam
The absence of experienced engineers in Vietnam also makes it difficult to start the production of new products in the country. One supply chain executive whose company works with Apple and Google says, “[Vietnam’s] engineering workforce is still far from adequate. With all the travel restrictions, it’s only feasible to make products in Vietnam that are already in mass production elsewhere, rather than starting production of upcoming products from scratch in the country.”
China and Vietnam have both tightened up their borders and are issuing passports at a slower rate in an attempt to slow down the spread of the delta variant of COVID-19. This has been confirmed by China’s National Immigration Administration. Moving production to Vietnam was made more difficult by a wave of COVID-19 infections that took place in the country back in May.
Several supply chain managers in China told the Nikkei that their staff is finding it harder to apply for business trips to Vietnam. A senior manager of an Amazon supplier says, “The border control has been tightened in the past few months. We could not easily dispatch our Chinese engineers to support our production projects for Amazon in northern Vietnam, so the company has been bringing in fully vaccinated Taiwanese engineers from China.”
To combat the rapidly spreading virus in Vietnam, several manufacturers have stopped production in the country including Samsung. Apple suppliers Foxconn, Luxshare, and Goertek also briefly halted production in Northern Vietnam back in May.
Annabelle Hsu, an IDC analyst, said that any setback for Vietnam is likely to be temporary. She said “We noticed there are some impacts on production lines and a slowdown in shifting of production capacity due to COVID-19 resurgence and government measures. However, we don’t think the Vietnamese government will adopt such strict measures for very long, otherwise it will affect its own economy and its rising manufacturing prowess.”