Published: Fri, July 05, 2019
Markets | By Otis Pena

HP, Dell, Asus, and Acer plan to shift production from China

HP, Dell, Asus, and Acer plan to shift production from China

Corporations foreign and domestic are seeking to pivot production away from China amid U.S. President Donald Trump's efforts to use punitive tariffs to negotiate friendlier trade terms.

HP has, meanwhile, downgraded its production forecast for 2019 to fewer than 10 million laptops, which is about half of its output two years ago, one source told Nikkei.

Nikkei previously reported that Apple is looking at moving up to 30 percent of its hardware production out of China, The Wall Street Journal said that Nintendo might move some Switch production, and Bloomberg said that Google has moved some production of Nest products.

The Redmond-based software giant, as well as HP, Dell, and Amazon could transfer at least part of their production to non-Chinese production plants, a report from Nikkei reads. "Ltd">Foxconn Technologyand Inventec - have all moved some production out of China to Taiwan, Mexico and the Czech Republic to avoid the threat of additional tariffs and to assuage customer concerns over USA claims of potential national security risks.

HP, Dell, Amazon, Microsoft, and Google did not immediately respond to a Reuters' request for comment.

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Last month, the media reported that Apple was exploring the cost implications of moving up to 30 percent of its smartphone production. Its become an important industry for the country, which is the world's largest manufacturer of both PCs and smartphones.

Dell is also planning to shift its production houses out of China and they are planning to move to Taiwan, Vietnam, and Phillippines. Neither Apple nor most of the companies in the Nikkei report have commented(via AppleInsider). But now, to avoid losing consumers, companies are opting to shift production outside China.

But moving supply chains out of China doesn't mean making new jobs in the United States.

The sources said that the five companies have been considering other Asian countries as possible new homes for their electronics production.

"Darson Chiu, an economist specialized in trade at the Taiwan Institute of Economic Research, stated that the downside of companies moving production out of China for the us could be that" products there could be more expensive".

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