[News] Wingtech Sells Key Business to Luxshare Following U.S. Blacklisting, Boosting Luxshare’s ODM Capabilities

Last year, the Biden administration added several Chinese companies it deemed a threat to U.S. national security to the Entity List. According to Bloomberg, citing Chinese media outlet Cailian, Wingtech—a Chinese supplier to Apple—decided to spin off a significant portion of its operations in an effort to cut ongoing losses caused by U.S. sanctions.

As noted in the report, Wingtech signed an agreement to sell its stakes in five subsidiaries to Luxshare Precision, as disclosed in a filing with the Shanghai Stock Exchange on Thursday. Additionally, assets from three other Wingtech units are also slated for divestment.

The sale of Wingtech’s product assembly business, involving assets worth approximately RMB 4.6 billion (around USD 635 million), would mark a full exit from this market. The move would allow the company to concentrate solely on its semiconductor operations.

Wingtech stated that being added to the Entity List has had a broad negative impact on its assembly business. If the situation remains unchanged, the company expects a significant drop in revenue in 2025. According to Bloomberg, Wingtech projected in January a full-year net loss of up to RMB 4 billion.

In a separate filing, Wingtech revealed that a key customer, referred to as “Customer A,” has not placed any orders since Wingtech was added to the U.S. Entity List. This client also canceled a 2025 purchase plan for 2.27 million devices, valued at RMB 14.5 billion. According to Chinese media outlet Cailian, “Customer A” refers to Apple.

As noted in the report, Wingtech was included in Apple’s supplier list in 2022. While Apple’s most recent vendor directory still lists Wingtech as a supplier, the situation may have already changed, Bloomberg indicates.

Furthermore, Wingtech has not received any new orders from other clients since December, according to Bloomberg.

Luxshare’s Strategic Acquisition

According to a report from Economic Daily News, although Wingtech is not an iPhone assembler, it entered the MacBook supply chain in 2023—previously dominated by Foxconn and Quanta—becoming the only Chinese supplier for that product line.

Luxshare Group has rapidly emerged in recent years as a key assembly partner for Apple. According to sources cited by Economic Daily News, the company is primarily targeting Wingtech’s non-Apple-related business. However, there is growing attention on whether Luxshare, after acquiring Wingtech’s related assets, might also seek to enter Apple’s laptop supply chain—potentially positioning itself as a competitor to established players such as Foxconn and Quanta.

Read more

• [News] Tech Firms Shift Operations, Adopting ‘Anything But China’ (ABC) Strategy Amid U.S.-China Strains
• [News] U.S. to Hold Hearing on China’s Legacy Chip Dumping, with Taiwanese Foundries Poised to Benefit

(Photo credit: Wingtech)