Tim Cook: Apple is considering building a manufacturing plant in Indonesia

PHOTO BY BAY ISMOYO / AFP

Apple CEO Tim Cook (right) walks with Minister of Communication and Information Budi Arie Setiadi (left) to meet with journalists after meeting with President Joko Widodo at the Merdeka Palace in Jakarta on Wednesday, (17/4/2024).

JAKARTA, KOMPAS  — Apple Inc, the technology giant that owns the smartphone brand iPhone, will consider the President's request Joko Widodo to build a manufacturing factory in Indonesia. Apple assesses that Indonesia still has an attractive investment destination in the manufacturing industrial sector.

This was said by CEO of Apple Tim Cook to the media after meeting with President Joko Widodo, Wednesday (17/4/2024), at the Merdeka Palace, Jakarta.

In the meeting, Cook was accompanied by Apple Inc Vice President Lisa Jackson, Global Head of Apple Inc Nick Amman, Head of Government Apple Inc Elizabeth Hernandez, and Government Affairs South East Asia Apple Inc Mirza Natadisastra. President Joko Widodo, on the other hand, was accompanied not only by Minister of Communication and Informatics (Menkominfo) Budi Arie and Minister of Industry (Menperin) Agus Gumiwang but also by Coordinating Minister for Economic Affairs Airlangga Hartarto.

"We're talking about the President's desire to see Apple's manufacturing in this country, and that is something we will consider," Cook said.

Also read: Apple CEO Meets President Jokowi, Indonesia Pushes for Addition of Apple Academy

PHOTO BY BAY ISMOYO / AFP

Apple CEO Tim Cook (center) spoke to journalists after meeting with President Joko Widodo at the Merdeka Palace in Jakarta on Wednesday (17/4/2024).

When asked if Apple believes that investing in Indonesia is profitable, Cook said that the ability or attractiveness to invest in Indonesia is unlimited. According to him, there are many good countries to invest in, and Apple believes that Indonesia has the potential to be a good place for investment.

Furthermore, Cook expressed his love for Indonesia. He enjoys the atmosphere, culture, spirit of young people, diversity, and dynamic local environment in Indonesia. He considers these as keys for Indonesia to progress better in the future.

"I think the future (Indonesia) is very bright," said Cook.

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In a meeting with President Joko Widodo, Cook mentioned that the Apple Developer Academy Bali has been inaugurated. The first Apple Developer Academy in Indonesia was opened in BSD City in Tangerang Selatan in 2018, followed by Apple opening the Apple Developer Academy in Surabaya and Batam. He hopes that the opening of the Apple Developer Academy Bali can graduate thousands of people and applications for the Apple Store that attract attention both domestically and internationally.

PHOTO BY BAY ISMOYO / AFP

Apple CEO Cook (center) spoke at a press conference after meeting with President Joko Widodo at the Merdeka Palace in Jakarta, accompanied by Minister of Communication and Information Budi Arie Setiadi (right) and Minister of Industry Agus Gumiwang Kartasasmita (left) at the Merdeka Palace in Jakarta on Wednesday (17/4/2024).

Other ideas

Agus Gumiwang said that President Joko Widodo wants Apple to have other ideas outside the Apple Developer Academy, such as an innovation center that collaborates with domestic universities and manufacturing establishments. All these matters will be followed up by ministries/institutions in Indonesia. The Ministry of Industry in particular will carry out a business matching process with Apple. The Ministry of Industry, he claimed, already has a list of cellphone components that have been produced in Indonesia and this will be discussed with Apple.

"If we refer to Vietnam, it took them 15-20 years and China 30 years to have a mature manufacturing industry supply chain. So, anyone just starting to build a supply chain will need time, but that doesn't mean it's impossible. "Earlier, Tim Cook was already willing and eager to manufacture in Indonesia," said Agus.

I think the future (Indonesia) is very bright.

Agus explained that the construction of four Apple Developer Academies by Apple was in accordance with the agreement with the Indonesian government. The four training institutions have already fulfilled 35 percent of the domestic component level (TKDN) with an investment scheme.

Budi Arie added that out of around 360 components in an iPhone unit, only 2 components are from Indonesia. Therefore, according to Budi, President Joko Widodo hopes that Apple can also build a supply chain of more components in Indonesia.

PHOTO BY BAY ISMOYO / AFP

Apple CEO Tim Cook waves when he arrives at the Merdeka Palace to meet President Joko Widodo, Wednesday (17/4/2024).

According to a research report by consumer market intelligence firm IDC quoted by CNBC, based on cellphone shipments from factory to market, Apple has become the third largest smartphone vendor in Vietnam, behind Oppo and Samsung. Vietnam has become a major manufacturing location as the Cupertino giant seeks to diversify its product assembly away from China.

For Indonesia, the International Data Corporation (IDC) research report in the third quarter of 2023 shows that in terms of shipments, the order of the largest number of smartphone vendors is Oppo, respectively. Samsung, Transsion, Xiaomi, and Vivo. Smartphones from Apple are in another category after Vivo.

Apple's dependence on China for its product assembly came under scrutiny in 2022 when strict Covid-19 social restrictions were enforced in China and worker riots at Foxconn factories disrupted production. Foxconn is the primary assembler of Apple's iPhone, a popular smartphone.

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