Apple’s Vietnam Shift: Foxconn, Luxshare, GoerTek and the AirPods Belt

The most important thing to understand about Apple in Vietnam is that Apple is not there; its suppliers are, and they are mostly Chinese. The iPhone maker holds no manufacturing licence in the country. Instead, between roughly 2019 and 2024, a chain of Taiwanese and mainland Chinese contract manufacturers, led by Foxconn, Luxshare Precision and GoerTek, built or expanded plants across northern Vietnam at Apple’s prompting, shifting a growing share of AirPods, Apple Watch, iPad and MacBook assembly out of China. This article traces how the belt formed, who runs it, what it makes, and what the 2025 tariff settlement between Washington and Hanoi means for a supply chain whose whole point was to look less Chinese. It is part of the Vietnam Company Stories hub.

Why did Apple start moving production to Vietnam?

Apple moved production to Vietnam because the 2018–19 US–China tariff war, then the 2020–22 lockdowns at Zhengzhou and Shanghai, made a China-only supply chain a board-level risk. Vietnam offered an existing Foxconn presence, proximity to Guangdong, and a government eager to host anyone Apple sent.

The timeline is reconstructable from Apple’s annual supplier list, which names the facilities responsible for roughly 98 percent of its direct spend. In the 2018 list, Vietnam had about 14 sites. By the 2020 list it had 21, by 2022 around 25, and by the 2023 and 2024 lists roughly 35, the fastest growth of any country outside China and a total that put Vietnam third or fourth behind China, Taiwan and Japan. India grew too, but Vietnam took the peripherals—AirPods, Watch, iPad, Mac—while India took iPhone.

Apple’s own public statements about Vietnam are sparse but revealing. During Tim Cook’s visit to Hanoi in April 2024, the company said it had spent over 400 trillion đồng, roughly $16 billion, in the Vietnamese supply chain since 2019 and supported around 200,000 jobs there, a figure that includes suppliers’ employees rather than Apple staff. The visit, which included a meeting with the prime minister and a photo-opportunity walk around Hoàn Kiếm lake, was widely read as a signal that Vietnam had graduated to strategic status.

The pull factors were the same as those that brought Samsung a decade earlier, with one difference: Apple’s suppliers did not need to be persuaded. Foxconn had been in Bắc Giang since 2007; Luxshare and GoerTek were already there for non-Apple work. What changed was that Apple, through its supplier-management teams, started allocating product programmes to Vietnamese sites and requiring capacity there as a condition of future business. The suppliers built because the customer told them to.

Who are the key suppliers and where exactly are they?

The belt runs along the highway from Hanoi to the Chinese border. Foxconn and Luxshare sit in Bắc Giang’s Quang Châu and Vân Trung parks; GoerTek is in Bắc Ninh’s Quế Võ park; Foxconn and Luxshare have both added large plants in Nghệ An, 300 kilometres south; Compal is in Thái Bình; and Wistron, Inventec and Quanta have taken sites in Hà Nam, Nam Định and elsewhere.

Foxconn, the Taiwanese group formally known as Hon Hai, is the anchor. Its Vietnamese registered capital has grown to something over $3 billion across roughly a dozen entities, including a $270 million iPad and MacBook plant in Bắc Giang licensed in 2021, a $246 million Nghệ An project in 2023, and further Bắc Ninh and Quảng Ninh sites for components, chargers and circuit boards. Foxconn also builds for non-Apple customers in Vietnam, including networking and EV components, and its chairman Young Liu has described Vietnam as the group’s most important base outside China and India.

Luxshare Precision, the Dongguan-based group founded by Wang Laichun, a former Foxconn worker, is the company that made Vietnam the AirPods capital. It arrived in Bắc Giang in 2016, added a large complex in Nghệ An’s VSIP park in 2019, and by 2023 was among Vietnam’s largest exporters in its own right, with Vietnamese revenue in the billions of dollars and a workforce that press reports put at more than 40,000 across sites. Luxshare’s Vietnamese plants assemble AirPods, Apple Watch and a range of connectors and cables, and the company has been reported as exploring iPhone-related capacity there.

GoerTek, from Weifang in Shandong, has made AirPods and other acoustic devices in Bắc Ninh since 2013 and expanded its Quế Võ plant in stages, with cumulative capital that Vietnamese licensing data put at several hundred million dollars. The three companies share a labour pool, a set of industrial park landlords, and a dependency on components trucked in from Guangdong. Their neighbours in the same parks make the moulded plastics, metal stampings, packaging and cables that the assembly lines consume.

Why are Apple’s Vietnamese factories run by Chinese and Taiwanese companies rather than Vietnamese ones?

Because Apple does not buy factories, it buys programmes, and the only companies that can run an Apple programme at the required yield, speed and audit standard are the ones that learned to do it in Shenzhen and Kunshan. Vietnamese firms supply parts and services to those companies; none has the scale or the tooling to be a final assembler.

The capability gap is not about labour but about engineering depth. A Luxshare or Foxconn site brings thousands of Chinese and Taiwanese engineers, its own automation teams, its own tooling shops and a supplier network it has already qualified with Apple. When a new AirPods generation is ramped, the process engineers who debug the line have done it before, in Chinese, in a plant that looks identical. No Vietnamese company has that institutional memory, and Apple has never shown any appetite for creating it; the company’s approach in India, where it has cultivated Tata as an assembler, has no Vietnamese equivalent so far.

Ownership also shapes what stays in the country. The contract manufacturers repatriate profits, import most inputs and pay the same preferential tax rates that Vietnam offers all large electronics investors. What remains locally is wages, park rent, utilities and a slowly growing tier of Vietnamese sub-suppliers in plastics, packaging, metal parts and logistics. Vietnamese officials have pressed Foxconn and Luxshare to raise local content, with mixed results; the firms answer, reasonably, that Apple specifies most components and that qualifying a new Vietnamese vendor takes years.

The consequence for Vietnam is a familiar one: a Chinese-run electronics enclave, exporting to the world, embedded in a Vietnamese province that supplies the workers and the land. It works, and it generates enormous export figures. It just does not look much like a Vietnamese industry, which is a distinction the tariff debate of 2025 turned from an academic point into a customs question.

What share of Apple’s products is now made in Vietnam?

By 2023–24, analyst estimates cited by Nikkei, JPMorgan and Evercore put roughly 65 percent of AirPods, about 20 percent of iPads and Apple Watches, and perhaps 5 percent of MacBooks in Vietnam, with the MacBook share rising as Foxconn’s Bắc Giang line ramped. Nobody outside Apple knows the exact numbers; Apple does not disclose them.

The pattern is that Vietnam got the products that are labour-intensive but not iPhone. AirPods are small, high-volume, and assembled largely by hand with acoustic testing; they were the first to move and are now overwhelmingly Vietnamese. Apple Watch followed, largely through Luxshare. iPad and MacBook are more complex, with tighter tolerances and more automated lines, and their move has been slower and more concentrated in Foxconn. The iPhone, Apple’s highest-value and most tightly controlled product, went to India instead, where Foxconn, Pegatron and Tata have built or acquired plants, and where a large domestic market and government incentives justified the extra complexity.

Vietnam’s trade statistics show the effect indirectly. Exports classified as computers, electronic products and components rose from about $36 billion in 2019 to over $70 billion in 2024, overtaking phones as the largest export category. A meaningful part of that increase is Apple-related output from Bắc Giang and Bắc Ninh, mixed with Intel, Dell and HP supplier volumes and with Chinese electronics firms unrelated to Apple. Bắc Giang, which was a poor agricultural province in 2010, has reported some of the fastest growth rates in the country for five consecutive years.

Apple also shows up in the supplier list geography. The 2024 list named sites in ten Vietnamese provinces, from Vĩnh Phúc to Đồng Nai, but the heavy concentration in Bắc Giang and Bắc Ninh reflects the practical reality that the belt works because everything is within two hours of everything else, and within a day’s truck drive of Shenzhen.

What happened when the belt hit its first real problems?

The belt’s first stress tests came in 2021, when a COVID outbreak in Bắc Giang closed Foxconn and Luxshare plants for weeks, and in June 2023, when northern power cuts halted lines at Foxconn, Luxshare and their suppliers. Both episodes cost days of output and, more importantly, made Apple ask hard questions about resilience in a country it had chosen precisely for resilience.

The 2021 outbreak was the more dramatic. Bắc Giang became Vietnam’s COVID epicentre in May 2021, with clusters centred on the Quang Châu and Vân Trung parks where tens of thousands of workers lived in cramped rented rooms around the factories. The province ordered the parks shut, then reopened them under a “three on site” regime in which workers ate, slept and worked inside the fence. Foxconn and Luxshare lost several weeks of production and Apple reportedly delayed some product ramps. The lesson the suppliers drew was to build dormitories inside park boundaries, which they subsequently did at Nghệ An and in later Bắc Giang expansions.

The 2023 power crisis was subtler but arguably more worrying because it exposed a structural constraint rather than a one-off. Northern Vietnam’s grid, short of both generation and transmission during a hot, dry May and June, cut supply to industrial parks on rotating schedules. Foxconn, Luxshare and Canon reported stoppages; foreign chambers of commerce wrote formal letters; and the government reshuffled EVN’s leadership. Apple’s response was not public, but suppliers accelerated investment in on-site generation and the government prioritised the 500 kV line reinforcement that was completed in mid-2024.

Labour tightness was the third and quietest problem. By 2022, Bắc Giang factories were hiring from provinces hundreds of kilometres away, offering signing bonuses and bus services, and turnover after the Tết holiday routinely reached 15–25 percent. The move to Nghệ An, a populous and poorer province with an underused labour pool, was as much about workers as about land.

How do the 2025 US tariffs change the economics of the belt?

The tariffs change the belt from a cost play into a rules-of-origin play. The 20 percent rate on Vietnamese goods is bad but survivable, given China faces higher rates; the 40 percent transshipment rate is the real threat, because most of what goes into an AirPod or an iPad in Vietnam was made in China. Apple’s suppliers now have to prove Vietnamese value added rather than merely Vietnamese assembly.

When the April 2025 tariff schedule set Vietnam at 46 percent, briefly higher than several Chinese rates, the entire premise of China Plus One appeared to collapse; Vietnamese officials flew to Washington and the government offered to cut tariffs on American goods and buy more Boeing aircraft and LNG. The July 2025 arrangement lowered the headline rate to 20 percent, but introduced the transshipment penalty. Smartphones and some electronics were initially exempt under separate tariff provisions, but the exemptions were provisional and the definition of transshipment was left to future regulation, as discussed in our piece on transshipment, rules of origin and the Chinese content problem.

For Apple and its suppliers the practical response has been three-fold. First, to push more component production into Vietnam—printed circuit boards, connectors, casings—so that local content rises above whatever threshold the rules eventually specify. Second, to route more Vietnamese output to non-US markets and more Indian output to the United States. Third, to lobby, which Apple does effectively, for product-specific exemptions of the kind it has historically secured for iPhones.

The irony is not lost on anyone in Bắc Giang. The belt exists because Apple wanted products that were not made in China. The US government now wants to know how much of those products is Chinese anyway, and the honest answer, for now, is most of it by value. The full trade context is covered in our analysis of the tariff shock and the 2025 trade deal.

What does the Apple belt mean for Vietnamese founders and investors?

It means a second, differently structured demand pool from Samsung’s: Chinese-managed, Apple-audited, and hungry for local suppliers that can pass a code-of-conduct inspection. The opportunities are in tier-2 components, industrial services, worker housing and logistics; the trap is building for a programme that Apple can reallocate to India or back to China at the next product cycle.

Apple’s supplier code of conduct is the entry ticket. Foxconn, Luxshare and GoerTek are audited annually on labour hours, dormitory standards, chemicals and environmental discharge, and they pass those requirements down to their own vendors. Vietnamese firms that already supply Samsung, as profiled in our companion piece on Samsung and the fifth of Vietnam’s exports it accounts for, have found the transition to Apple’s chain feasible; firms starting from scratch have found the documentation burden heavier than the technical one.

For investors, the listed exposure is again in the landlords. Kinh Bắc City, whose Quế Võ and Quang Châu parks host GoerTek and Foxconn, has for years traded as an Apple proxy on the Ho Chi Minh Stock Exchange; the industrial-park sector generally is covered in our article on Becamex, VSIP and Kinh Bắc. Logistics operators handling air freight out of Nội Bài and sea freight through Hải Phòng, and power producers with northern generation, are the other proxies.

For operators, the strategic lesson is about position in the chain. The contract manufacturers earn low-single-digit net margins and carry the capex; Apple earns the profit; the landlords and utilities earn a steady rent. In Vietnam, as in China before it, the most durable returns in the Apple supply chain have gone to those who own the ground the factories sit on, not the factories themselves.

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