US-based technology giant Apple will allegedly produce millions of wireless earphones called AirPods in Vietnam from this quarter – a clear move to diversify its manufacturing operations.

Apple will produce millions of AirPods in Vietnam to diversify operations

30% of the AirPods, approximately three to four million units, would be manufactured in Vietnam, according to newswire Nikkei Asian Review.

"The mass production of AirPods in Vietnam started as early as in March," a person familiar with the matter said. "The Vietnamese officials even granted special permits for a key Apple AirPods assembler to help the company bring in engineers to the country for smooth production during the lockdown."

Previously, the giant had ordered its suppliers to produce up to 45 million units in the first half of the year to keep up with the surging demand for the wireless earphones.

A couple of weeks ago, Apple posted job advertisements in Vietnam on LinkedIn, including the post of operations manager based in Hanoi and test engineers in Ho Chi Minh City.

These recruitment notices add more credence to previous rumours that the firm would ramp up its outsourcing manufacturing to Vietnam, while Foxconn, the world’s biggest electronics contract manufacturer and a key supplier of Apple, also has a facility in Bac Ninh province.

Nikkei cited the familiar source, "It's still an irreversible trend that big US tech companies will need to gradually seek production bases outside of China. Most of the US companies including Apple are looking for non-China production. (...) Some prefer Vietnam and some like Thailand or India, and some chose the Americas and others Southeast Asian nations."

In fact, a variety of US corporations such as Google and Microsoft are allegedly making further inroads into the country. HP and Dell are also said to be moving up to 30% of their notebook production to Vietnam.

Meanwhile, Inventec, an AirPod assembler, is currently building a plant in Vietnam at Apple's request.

Merry Electronics, Apple’s acoustic component supplier, is reportedly collaborating with Luxshare to prepare a facility in Vietnam. The company said its operations will begin this summer.

Other Apple suppliers such as Foxconn and Pegatron are also increasing their footprint in north Vietnam, even though they are not necessarily helping to make Apple products there at the moment.

Previously, the International Monetary Fund (IMF) has forecast Vietnam’s GDP to grow at 2.7% this year, higher than that of its regional peers.

However, Vietnamese Prime Minister Nguyen Xuan Phuc demanded that the country must obtain a GDP growth rate higher than IMF’s forecast, to be the highest in Southeast Asia.

Vietnam stopped social distancing restrictions, even in several high-risk localities such as Hanoi and Ho Chi Minh City last month.