Apple Inc’s Chinese suppliers are likely to move capacity out of the country far faster than many observers anticipate to pre-empt fallout from escalating Beijing-Washington tensions, one of the US company’s most important partners said.
AirPods maker GoerTek Inc (歌爾聲學) is one of the many manufacturers exploring locations beyond its native China, which today cranks out the bulk of the world’s gadgets from iPhones to Sony Corp’s PlayStations.
GoerTek is investing an initial US$280 million in a new Vietnam plant, while considering an India expansion, deputy chairman Kazuyoshi Yoshinaga said in an interview.
US technology companies in particular have been pushing hard for manufacturers such as GoerTek to explore alternative locations, said the executive, who oversees GoerTek’s Vietnamese operations from northern Bac Ninh Province.
“Starting from last month, so many people from the client side are visiting us almost every day,” Yoshinaga said from his offices at GoerTek’s sprawling industrial complex north of Hanoi.
The topic that dominates discussions: “When can you move out?”
The expanding conflict between the US and China, which began with a trade dispute, but has since expanded to encompass sweeping bans on the exchange of chips and capital, is spurring a rethink of the electronics industry’s decades-old supply chain.
The US giant has been careful to avoid suggestions it might reduce its investment in China, where it has built an ecosystem centered on companies such as GoerTek and Foxconn Technology Group (富士康科技集團), which collectively employ millions.
Taiwan-based Hon Hai Precision Industry Co (鴻海精密) is known internationally as Foxconn.
While Bloomberg Intelligence estimates it could take eight years to move just 10 percent of Apple’s capacity outside of China, the GoerTek executive said it would happen far quicker.
Most Chinese tech manufacturers are experiencing the same pressure.
“I would say currently 90 percent of them, they’re looking at that,” he added. “It’s the brand companies’ decisions.”
India is high on clients’ wish lists — a reflection of its potential both as a market and a manufacturing base.
“We get requests from our clients almost every month. ‘Do you have any plans to expand to India?’” Yoshinaga said. “If they decide to build up the production lines in India, we may have to think about it seriously.”
PATENTS: MediaTek Inc said it would not comment on ongoing legal cases, but does not expect the legal action by Huawei to affect its business operations Smartphone integrated chips designer MediaTek Inc (聯發科) on Friday said that a lawsuit filed by Chinese smartphone brand Huawei Technologies Co (華為) over alleged patent infringements would have little impact on its operations. In an announcement posted on the Taiwan Stock Exchange, MediaTek said that it would not comment on an ongoing legal case. However, the company said that Huawei’s legal action would have little impact on its operations. MediaTek’s statement came after China-based PRIP Research said on Thursday that Huawei filed a lawsuit with a Chinese district court claiming that MediaTek infringed on its patents. The infringement mentioned in the lawsuit likely involved
Taipei is today suspending work, classes and its US$2.4 trillion stock market as Typhoon Gaemi approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed income trading, statements from its stock and currency exchanges said. Authorities had yesterday issued a warning that the storm could affect people on land and canceled some ship crossings and domestic flights. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) expects its local chipmaking fabs to maintain normal production, the company said in an e-mailed statement. The main chipmaker for Apple Inc and Nvidia Corp said it has activated routine typhoon alert
GROWTH: TSMC increased its projected revenue growth for this year to more than 25 percent, citing stronger-than-expected demand for AI devices and smartphones The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) yesterday raised its forecast for Taiwan’s GDP growth this year from 3.29 percent to 3.85 percent, as exports and private investment recovered faster than it predicted three months ago. The Taipei-based think tank also expects that Taiwan would see a 8.19 percent increase in exports this year, better than the 7.55 percent it projected in April, as US technology giants spent more money on artificial intelligence (AI) infrastructure and development. “There will be more AI servers going forward, but it remains to be seen if the momentum would extend to personal computers, smartphones and
Catastrophic computer outages caused by a software update from one company have once again exposed the dangers of global technological dependence on a handful of players, experts said on Friday. A flawed update sent out by the little-known security firm CrowdStrike Holdings Inc brought airlines, TV stations and myriad other aspects of daily life to a standstill. The outages affected companies or individuals that use CrowdStrike on the Microsoft Inc’s Windows platform. When they applied the update, the incompatible software crashed computers into a frozen state known as the “blue screen of death.” “Today CrowdStrike has become a household name, but not in