Apple CEO Tim Cook recently made his second public visit to China this year amid challenges like a reported investigation into major iPhone supplier Foxconn.
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As some US companies cut back on their dependence on China, Apple could be hardest hit, says Steve Jobs’ biographer.
Walter Isaacson told “Squawk Box” that “it’ll be hardest” for Apple to decrease reliance on China.
Tim Cook recently visited China amidst reports of lagging iPhone 15 sales and a probe into Foxconn.
As more US companies are trying to cut back on relying on China for business, Apple could be the one hardest hit if economic tensions continue to escalate.
That’s according to Walter Isaacson, the biographer of late Apple cofounder Steve Jobs and Tesla CEO Elon Musk, who told CNBC’s “Squawk Box” on Tuesday that he thinks Apple will find it most difficult to decrease its reliance on China, which manufactures the vast majority of its products.
“We are somehow or other, barreling down a road of trying to disengage with China economically, which is not easy to do, and Apple will be the one most hurt,” Isaacson said. “Most companies are trying to decrease their dependence on China, but it’ll be the hardest for Apple to do that.”
“We’re going to have to try to strike some equilibrium between total disengagement, which in my mind is not going to work, and total dependence, which we’ve been a little bit too dependent on them,” he added.
Apple CEO Tim Cook recently touched down in China for the second time this year. On his unexpected visit, he met with Chinese commerce minister Wang Wentao in Beijing and dropped by an Apple store in Chengdu, roughly 1,000 miles away, that was hosting a Tencent gaming tournament, Bloomberg reported.
He visited amid a report of sluggish iPhone 15 sales in the country, which is one of Apple’s largest markets. Sales of phones in the iPhone 15 lineup in the first 17 days were down 4.5% compared to last year’s iPhone 14 models over the same period, according to an early estimate from technology market research company Counterpoint Research.
China is reportedly weighing a crackdown on a loophole that allows citizens using Apple’s App Store to access otherwise forbidden apps, including social media apps like Instagram, WhatsApp, YouTube, and X, formerly known as Twitter, according to The Wall Street Journal.
Apple has also faced hurdles in China on the production side of the business. More than 95% of iPhones, Macs, AirPods, and iPads are made in China, according to the Financial Times. Chinese authorities have reportedly opened an investigation into Taiwan-based Foxconn, a longtime supplier of iPhones, over taxes and land use, according to Chinese media. The news comes after Foxconn’s billionaire founder, Terry Gou, announced his bid for presidency in Taiwan in August.
The White House recently introduced export controls on the sales of semiconductors that could make it difficult for Chinese companies to obtain chips made using US technology, which could further strain business relations between the US and China.