[News] Apple May Manufacture iPhones in Indonesia to Reverse Sales Ban

According to a report from Nikkei, sources indicate that Apple suppliers are working to establish iPhone production in Indonesia as the company continues negotiations with the Indonesian government to lift the sales ban on iPhones 16.

If the plan moves forward, as highlighted in the report, it would mark Apple’s first-ever iPhone production in Indonesia, where it currently lacks a significant supply chain ecosystem.

The report further explains that Indonesia has implemented a 35% local content requirement—including both components and software—for smartphones sold in the country. In response, almost all major smartphone brands, including Samsung, Oppo, Transsion, Xiaomi, and Vivo, have already set up local production facilities or partnered with domestic firms to assemble their devices in Indonesia, while Indonesia also banned sales of Google Pixel phones for the same reason, as noted by a report from Reuters.

Although Apple’s market share in Indonesia stands at only about 1%, the report notes that the potential for growth is considerable. However, the report also underscores the potential challenges Apple may face if it proceeds with iPhone production in the country. As noted, manufacturing in Indonesia would require Apple to divert its supply chain management resources to a third country, following its existing operations in China and India.

The report highlights that Apple currently has only one component supplier with an Apple-certified facility in Indonesia, further complicating the production shift.

Meanwhile, reports have been circulating regarding Apple’s broader supply chain diversification strategy. According to a report from ijiwei, Apple is reportedly adjusting its global production strategy by scaling back its MacBook manufacturing expansion plans in Vietnam while placing greater emphasis on India.

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