Nikkei: Apple Discusses Setting Up iPhone Manufacturing Facilities in Indonesia
About four months ago, Indonesia imposed a sales embargo on Apple’s iPhone 16 series, putting the company in an odd position. Cupertino had not fulfilled Indonesia’s stringent investment requirements, which demand that businesses source up to 40% of their device components domestically. A recent report from Nikkei Asia claims that Apple is currently negotiating with supply chain partners to establish iPhone assembly lines in Indonesia in order to meet the demands of the local government.
Indonesia will have iPhone production facilities, making it the second-largest country in Southeast Asia behind Vietnam, if all goes as planned. The addition of iPhone production will significantly strengthen Indonesia’s tech manufacturing sector, which is the largest economy in the region.
When the iPhone 16 series and Watch 10 series devices were banned from sale in October, the Apple-Indonesia saga officially began. Apple only invested $95 million of the $109 million it had originally promised to invest in local R&D centers. Apple promised an extra $10 million and a new plant in the Bandung region to produce parts and accessories for Apple devices after the sales restriction was implemented.
Apple made a new financial promise of $1 billion and established a local manufacturing plant for Apple AirTag trackers because such measures were insufficient to get over the ban. Apple appears to have finally given in to pressure from the Indonesian government, and if everything goes according to plan, the iPhone ban will soon be lifted.
