Published on October 23, 2023, 1:32 pm
Image source: Fox News
Luxshare Precision, one of Apple’s significant manufacturing partners, has a long and successful history with the tech giant. The founder of Luxshare went from being an assembly line worker to becoming the CEO of this major manufacturing partner.
Apple’s supply chain is vast but concentrated among a few key assembly partners. While Foxconn is the largest among them, Luxshare Precision stands out as a competitor handling many of Apple’s orders.
Recently, Apple CEO Tim Cook paid a surprise visit to a Luxshare Apple Watch factory near Shanghai. During his visit, Cook praised the company for its product quality and had positive comments about the factory’s use of solar panels.
This was not Cook’s first visit to Luxshare; he previously visited the company in 2017. During that time, Cook expressed his satisfaction with Luxshare’s precision and care in manufacturing Apple products. He also commended CEO Grace Wang for building a culture of excellence within the company.
To understand Luxshare’s journey, it is essential to recognize Wang’s background as an early employee at Foxconn. After spending a decade there, she left in 1998 to establish her own factory producing electric cords. Wang took valuable lessons from Terry Gou, the founder of Foxconn, which laid the foundation for Luxshare’s success.
Luxshare gained recognition when it went public and acquired various companies in different industries. This earned it the nickname “octopus.” One of its notable acquisitions was a cable producer for the iPad, which led to more opportunities in producing cables, connectors, earphones, and camera modules.
In 2016, after acquiring specific expertise through another acquisition, Luxshare secured orders from Apple to manufacture AirPods. Apple even sent engineers to assist with production and found that Luxshare’s production process resulted in minimal defects.
Wang demonstrated her knowledge and understanding of Apple products during Cook’s 2017 visit by reciting details about Mac models and charging interfaces. She acknowledged that Apple’s stringent requirements had a profound impact on Luxshare’s growth and success.
As Luxshare continued its expansion, it climbed higher up Apple’s supplier list. In addition to its existing work, Luxshare took over iPhone manufacturing facilities in China from Wistron.
Luxshare also benefited from other Apple suppliers, such as Foxconn, which had concerns about low profit margins while working with Apple. The difficulties faced by Foxconn in late 2022 resulted in Luxshare becoming an alternative production route for Apple. In 2022, it was reported that Apple was Luxshare’s largest customer, accounting for more than 73% of its revenue.
To reduce dependency on one client and diversify its revenue streams, Luxshare has invested in new ventures. It aims to acquire suppliers for electric vehicle producers and expand further into the automotive industry.
Despite its expansion into different markets, Luxshare continues to maintain a successful relationship with Apple. According to TF Securities analyst Ming-Chi Kuo, Luxshare is now responsible for handling the “new product introduction” phase for the 2024 iPhones.
While Luxshare remains a Chinese company, it has also played a role in helping Apple diversify its production into countries like Vietnam and India. Additionally, Luxshare is gearing up to assemble a future version of the Apple Vision Pro headset that may launch in 2027.
In conclusion, Luxshare Precision’s journey from humble beginnings to becoming one of Apple’s major manufacturing partners showcases the strong relationship between the two companies. With a history rooted in dedication to quality and precision manufacturing, Luxshare continues to play a crucial role in supporting Apple’s supply chain and driving innovation in various product categories.
Original article posted by Fox News