Apple Eyes Manufacturing Expansion in Indonesia Amid China Diversification

As part of its ongoing efforts to diversify its supply chain beyond China, Apple is now eyeing manufacturing opportunities in Indonesia, according to CEO Tim Cook.

Following a meeting with Indonesian President Joko Widodo, Cook told reporters that the company will "look at" the prospect of setting up manufacturing operations in the Southeast Asian nation.

"We talked about the president's desire to see manufacturing in the country and it's something that we will look at," Cook said. "I think the investment ability in Indonesia is endless. I think that there's a lot of great places to invest. And we're investing. We believe in the country."

The comments underscore Apple's push to broaden its manufacturing footprint beyond its heavy reliance on China, where the majority of its products, including iPhones, iPads and MacBooks, are currently assembled.

The COVID-19 pandemic, which repeatedly disrupted operations at Apple's main iPhone factory in China, has only accelerated this diversification strategy. The company has already ramped up production in countries like Vietnam and India in recent years.

Now, Indonesia appears to have caught Apple's eye as a potential new manufacturing hub. While the tech giant currently has no production facilities in the country, it has invested significantly in developing the local app developer ecosystem, having launched four Apple Developer Academies in Indonesia since 2018.

"Given the slowing Chinese economy as well as the Chinese government's ongoing efforts to squeeze out foreign companies and replace them with domestic brands, Apple wants alternatives for manufacturing," said Chris Miller, an associate professor at Tufts University who studies technology and geopolitics.

Indonesia's President Widodo has made attracting manufacturing investment a key priority for his administration, particularly in industries that can leverage the country's abundant natural resources, such as nickel and other raw materials.

The potential for Apple to establish a manufacturing presence in Indonesia would align with this broader industrial strategy, as the tech company seeks to reduce its reliance on China and diversify its supply chains across Southeast Asia.

However, any concrete plans for Apple to begin manufacturing in Indonesia remain to be seen. Cook's comments suggest the company is in the early stages of exploring the possibility, as it continues to navigate the shifting global landscape for high-tech production.

For now, Apple's focus on bolstering its app developer ecosystem in Indonesia through the expansion of its Academy program appears to be the more immediate priority. But the prospect of the tech giant setting up manufacturing operations in the country has certainly piqued the interest of both sides.