Apple Can't Seem To Cut Ties With China: Tech Giant Reportedly Teams Up With Chinese Manufacturer For AR Product

Apple Inc. APPL was proactively looking to reduce its reliance on Chinese suppliers against the backdrop of simmering political tensions between the country and the U.S. Now, it appears that the tech giant has settled for a Chinese supplier for its augmented reality, or AR, device.

What Happened: Apple has opted to use Luxshare, a rapidly rising Chinese tech company, for the manufacture of its AR devices, reported Nikkei.

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This is a deviation from the tech giant’s earlier stance of relying on Taiwanese suppliers such as Hon Hai Precision Manufacturing Company Limited HNHPF for manufacturing the first generation of its new product lines.

Pegatron, another Taiwanese supplier, was the first company chosen for manufacturing AR devices and worked on it on and off for four years but the collaboration ended after the former became skeptical about the latter’s intent in moving ahead with the product, the report said.

Luxshare is reportedly interested in grabbing as much business as possible from Apple in multiple areas. The Chinese company currently helps the U.S. company in manufacturing iPhones, Apple Watch and AirPods.

Leaving No Stone Unturned: Cupertino reportedly has high expectations for its AR devices and as an extension wants to use multiple suppliers to make the product a success.

Hon Hai, popularly called Foxconn, is also helping with the AR project, Nikkei said. The iPhone assembler is reportedly working on developing a cheaper second-generation AR device. The company has also tapped Taiwan Semiconductor Manufacturing Company Limited TSM and Sony Group Corp. SONY for manufacturing OLED displays for AR devices.

Price Action: Apple closed Wednesday’s session at $148.91, up 0.29%, according to Benzinga Pro data.

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