The massive IPO success of More Threads, founded by a former NVIDIA executive, highlights immense domestic investor enthusiasm for creating a homegrown alternative to NVIDIA, backed by unprecedented government capital and political will.
China offers a hyper-concentrated manufacturing ecosystem where suppliers are neighbors, supported by world-class infrastructure. This dramatically speeds up prototyping and production, turning complex international logistics into a simple "walk down the street."
From China's perspective, producing more than it needs and exporting at cutthroat prices is a strategic tool, not an economic problem. This form of industrial warfare is designed to weaken other nations' manufacturing bases, prioritizing geopolitical goals over profit.
Apple's deep reliance on China is not just about cost but a 25-year investment in a manufacturing ecosystem that can produce complex products at immense scale and quality. Replicating this unique combination in India or elsewhere is considered fanciful.
China deliberately maintains an undervalued renminbi to make its exports cheaper globally. This strategy props up its manufacturing-led growth model, even though it hinders economic rebalancing and reduces the purchasing power of its own citizens.
China is explicitly subsidizing domestic semiconductor firms through its National Integrated Circuit Industry Investment Fund. This state-backed capital is the key driver behind its policy to achieve technological independence and replace foreign companies like NVIDIA.
To mitigate its own risk, Apple's "50% rule" required suppliers to find other customers. This policy forced them to share advanced manufacturing processes co-developed with Apple, directly enabling the rise of Chinese smartphone rivals like Xiaomi and Huawei.