Apple’s iPhone maker says Chinese rivals are poaching its workers in Vietnam

Apple’s iPhone maker says Chinese rivals are poaching its workers in Vietnam

Apple’s iPhone maker says Chinese rivals are poaching its workers in Vietnam

  • Apple’s largest iPhone maker Foxconn said its Chinese rivals are poaching its workers in Vietnam.
  • Vietnam has 31 companies that employ 160,000 workers to manufacture and assemble Apple products.
  • Apple wants to reduce its dependence on China and has urged suppliers to expand into Vietnam.

A battle for talent for the 160,000 workers who assemble Apple’s products in Vietnam is raging, with a top iPhone assembler crying over how his Chinese rivals are trying to attract cheap labor in the Southeast Asian country.

Young Liu, the CEO and chairman of Foxconn, the world’s largest iPhone maker, told reporters on Saturday that he noticed the company’s Chinese competitors setting up campuses near its base in Vietnam to get closer to its employees.

“When our competitors found out where Foxconn was building our factory, they went and bought a piece of land next to ours so they could ride our coat and strip our talents with high salaries,” Liu said, according to Bloomberg.

According to the outlet, Liu said the company’s Bac Ninh City campus currently employs about 60,000 employees, but he plans to increase that number “significantly” over the next two years.

Foxconn did not immediately respond to Insider’s request for comment.

China-based manufacturers are struggling with rising production costs in the country, with many being drawn to Vietnam for its abundance of cheap and skilled labor, according to an investment report by AXA Investment Management released in September.

At least three Chinese suppliers plan to assemble more Apple products in Vietnam. BYD will begin production of iPads in Vietnam this month, according to Nikkei Asia. Luxshare ICT and Goertek are also opening a shop in Vietnam to assemble AirPods, Apple analyst Kuo Ming-Chi said in a tweet in May.

They will join the current crop of 31 companies — employing about 160,000 workers — currently manufacturing Apple products in Vietnam, according to Saigon Online.

There are strategic considerations for Apple as it wants to reduce its reliance on China for product assembly. In 2020, Apple requested Foxconn to start making MacBooks and iPads in the Southeast Asian country, citing the need to minimize the impact of trade tensions between the US and China, according to Reuters.

China’s tough stance on COVID-19 was another reason for Apple’s push in Vietnam, according to a Wall Street Journal report last month. The company recently said China’s COVID-19 restrictions in China could cost it $4 billion to $8 billion in revenue for its current quarter ending June. Foxconn had to shut down operations in Shenzhen for a few days in March as the city tried to deal with a spike in COVID-19 cases.