Apple Turns to Japan to Ease China Rare Magnet Squeeze

Apple Inc.'s Telangana factory, which is run by Foxconn to assemble its AirPods, is procuring rare-earth magnets for wireless earbuds from Japan in order to get over the Chinese government squeeze on their supplies to the company.

- SURAJEET DAS GUPTA

This squeeze had forced the company to close down the plant for two weeks till June-end—a move that was unprecedented.

Government sources privy to the development say that the quick action by Apple Inc. has helped the company to restart production of AirPods at the factory in Kongara Kalan from the beginning of July. To ensure continuity in production, Apple Inc. has told the government that the company is looking at other sources for magnets, which include Uzbekistan, to get over the Chinese action.

The AirPods are currently only for exports, primarily to the US and Europe.

Sources say that the company has informed the government that this could increase the cost of producing the AirPods in India vis-à-vis China, and could make them globally uncompetitive, especially since the focus is on exports.