When former Apple supplier GT Advanced Technologies went bankrupt, it had to wind down operations at its sapphire production plant in Mesa, Arizona. Apple later ended up acquiring the facility from GTAT, and then this week it was reported that the iPhone maker is preparing to expand its production to the site. However, the company says that’s not actually true.
Apple renews FTZ status at Mesa site
TechCrunch had noticed a Notice of Proposed Production Activity that had been filed for the production facility in Mesa. The notice was to renew the Foreign Trade-Zone status that the site had. After reporting on the notice and stating that Apple was planning to expand its production at the site, the company reached out to TechCrunch, stating that it has no plans to produce anything there.
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The application to renew the Foreign Trade-Zone status for the facility automatically triggered the Notice of Proposed Manufacturing Activity, the company said. However, the iPhone maker plans to turn the Mesa site into a “global command hub for its data center operations,” TechCrunch said in an update to its earlier post.
Apple reportedly plans to turn the Mesa location into a sort of command center for teams working on its servers, including operations such as configuring them and fixing them into racks. Then the servers will be distributed to the company’s data centers located around the globe.
The notice that was released by the Federal Register this week supports this, as Apple specifically named data server cabinets in it. TechCrunch surmised originally that the site would be used to build out the company’s data center operations, so it was partially correct.
Why renew the FTZ status?
TechCrunch believes that renewing the FTZ status is more about “retaining certain distribution and logistical benefits that stem from having a site with the designation” instead of enabling Apple to expand its U.S. manufacturing operations. Currently the data center hub isn’t up and running yet, but Apple told the tech blog that the teams located there will do no more than assemble servers into racks and then ship them off.
Apple also reminded TechCrunch that it does use some suppliers that are based in the U.S. Its last supplier report listed 69 manufacturing locations in the U.S. U.S.-based suppliers provide the glass for iOS devices, chips for Macs and iOS devices, and other components.
Shares of Apple closed up 0.1% at $119.11 on Tuesday.