Apple's Chinese Partner Luxshare Set to Transform iPhone Production Landscape with Major Acquisition
Portfolio Pulse from Anusuya Lahiri
Luxshare Precision Industry Co is acquiring a 62.5% stake in Pegatron Corp's Kunshan unit for about 2.1 billion yuan ($300 million), which may enhance Apple Inc's relationship with China-based suppliers and Beijing. This move could make Luxshare a stronger competitor against Foxconn, which currently assembles 70% of iPhones. Apple, with 20% of its sales from Greater China, is also diversifying production, expanding in India with Foxconn and Pegatron's help. AAPL shares were up 0.44% at $194.01 recently.
December 28, 2023 | 5:53 pm
News sentiment analysis
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POSITIVE IMPACT
Apple's Chinese partner Luxshare's acquisition of Pegatron's unit may bolster Apple's supply chain in China and reflects its strategy to diversify production globally.
The acquisition is likely to be viewed positively as it could lead to a more diversified and resilient supply chain for Apple, which is critical for its operations. The slight increase in stock price indicates a modest positive market reaction.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Luxshare's acquisition of Pegatron's Kunshan unit may increase competition for Foxconn, potentially impacting its dominance in iPhone assembly.
Foxconn, which assembles a majority of iPhones, may face increased competition from Luxshare, potentially affecting its market share and future contracts with Apple.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70