Wingtech Technology tries to further penetrate into Samsung and Apple supply chains

At present, Wingtech Technology, a mobile phone manufacturer, is vigorously recruiting workers for its Kunming factory. The increase in the number of workers reflects the company's huge ambitions. Wingtech, which has quietly built up manufacturing capabilities to supply domestic brands, is now seeking to further penetrate the supply chains of global giants such as Apple and Samsung.

Driving 40 kilometers south from Kunming, Wingtech’s recruiters are busy hiring tens of thousands of workers for the company’s expanded factory, which the company hopes will eventually supply Apple with products.

“We are aggressively hiring. For Phase 2 alone, we initially thought we would need to hire around 15,000 workers, but we just learned that the hiring target will increase to more than 20,000,” said one recruiter. My colleagues are running campaigns in many cities and schools in Yunnan and working with local governments to recruit more labor."

Wingtech's Kunming factory is located at the bottom of a plateau at an altitude of 1920 meters. The plant will eventually employ at least 30,000 workers, up from just a few thousand currently, recruiters said, citing Wingtech's plans. The Kunming factory covers an area of ​​more than 427,000 square meters, equivalent to 80 football fields, and has produced tens of billions of yuan worth of smartphones and other products for domestic companies such as vivo and OPPO since it began operations in July last year. Currently under construction is the second phase of the Kunming Intelligent Manufacturing Industrial Park, with a total investment of about 3 billion yuan, which will produce laptops and smartphones.

Rise rapidly

According to industry insiders, the rise of Wingtech is astonishing. Just less than a year ago, Wingtech Technology began to supply Apple after acquiring Guangzhou Delta Imaging Technology Co., Ltd. of Oufei Photonics, and it has developed to produce Apple's Mac mini desktop. The company recently won an order to make older-generation Macbooks (rumored to be the MacBook Air) at its Kunming plant, according to three people familiar with the matter. This achievement is impressive considering Apple's notoriously strict quality standards.

"Wingtech is one of the few Chinese technology suppliers that has been praised by Apple for its rapid technological progress, and it is indeed a rising star that we should not ignore," said an Apple supplier executive.

Currently, the Macbook is one of the most advanced consumer laptops on the market. Their production has long been dominated by Taiwanese contract manufacturers Quanta Computer and Foxconn. Although other well-known Taiwanese contract manufacturers such as Compal Computer and Wistron have been supplying HP, Dell and Lenovo for decades, they have never received an order for Apple's iconic laptop. Several industry sources say Wingtech is already producing notebooks for Samsung, Lenovo and Asus.

An executive of the MacBook supply chain said: "If Wingtech can regularly get MacBook production orders in the future, the technology supply chain will be very surprised, because the production of MacBook is not so easy, it involves many components and assembly techniques. "

Acquisition of manufacturing technology through overseas acquisitions

Wingtech captures Apple's recent trend of partnering with more Chinese suppliers. For example, Luxshare, Goertek and BYD. It has also made a slew of overseas acquisitions in order to bring its manufacturing technology up to the level required by Apple.

In 2019, Wingtech acquired chipmaker Nexperia from NXP, and then bought the UK's largest chip factory through Nexperia in 2021. It also acquired four subsidiaries of former Apple supplier Oufeiguang for know-how to make optics and camera modules. With Nexperia, Wingtech also has chip packaging and testing facilities in Guangdong, the Philippines and Malaysia, and its equipment and components production bases are located in China, Japan, India and Indonesia.

Wingtech also plans to build a chip factory in Kunming. According to the enterprise data platform, in late July, the company registered a subsidiary in Shanghai with a paid-in capital of 20 million yuan, and its business will include electronic equipment and chip manufacturing.

Experts say this combination of domestic and overseas activities has paid off. "Wingtech's rapid rise is because it has the excellent base that a leading smartphone manufacturer has, where it can nurture its own business and acquire know-how, and conduct it in the supply chain by acquiring chip and electronic component suppliers. vertical integration to enhance its capabilities," said Teng Zhe'an, a technology industry analyst at Nomura Securities.

Enter high-margin business

Now, Wingtech aims to expand beyond smartphone assembly into more lucrative areas.

Ivan Lam, an analyst at market research firm Counterpoint Research, said: "Wingtech has recently focused more on new areas such as optics and camera components, semiconductors and smart car cockpits. … It’s a high-end, unprofitable smartphone assembly business. It definitely wants to partner with international brands like Apple and Samsung, because serving these big companies can help it hone its technology.”

However, Teng Zhe'an believes that serving global brands may mean building capacity outside China. Apple, Samsung and other international customers are now looking to diversify their production bases to reduce the risk of supply chain disruptions.

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