Elon Musk’s Space Exploration Technologies Corp (SpaceX) asked Taiwanese suppliers to transfer manufacturing out of Taiwan, leading to some relocating portions of their supply chain, according to sources employed by and close to the equipment makers and corporate documents.
A source at a company that is one of the numerous subcontractors that provide components for SpaceX’s Starlink satellite Internet products said that SpaceX asked their manufacturers to produce outside of Taiwan because of geopolitical risks, pushing at least one to move production to Vietnam.
A second source who collaborates with Taiwanese satellite component makers in the nation said that suppliers were directly asked by SpaceX to transfer manufacturing abroad.
Photo: Reuters
Chin-Poon Industrial Co (敬鵬工業), a satellite component maker which said it was recently a SpaceX supplier, told reporters that the US company requested it move its manufacturing from Taiwan to Thailand for new orders “mostly due to geopolitical considerations.”
It did not elaborate.
The sources declined to be identified because the information was not public.
SpaceX did not reply to requests for comment.
SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year it is an “integral part” of China, drawing sharp criticism from Taipei.
China views democratically governed Taiwan as its own territory and has staged almost daily military drills around it over the past five years and has never renounced taking the island by force. Taiwan rejects China's sovereignty claims.
China's drills have increased in intensity since 2022, with the latest war games it carried out last month replicating a blockade of the island. Amid the potential for devastating disruptions to their supply chains, some Taiwanese companies in the strategic satellite and semiconductor industries are taking steps to reduce their reliance on domestic manufacturing.
A Vietnam-based investment adviser last month told reporters that SpaceX representatives said in a private meeting in March last year the company was interested in setting up a manufacturing hub for satellite equipment in Vietnam and sought advice on protecting intellectual property.
Asked about Taiwanese SpaceX suppliers moving abroad, the Ministry of Economic Affairs said that “short-term political factors should not affect the supply chain relationship between international satellite companies and Taiwan manufacturers.”
Taiwanese SpaceX supplier Wistron NeWeb Corp (WNC, 啟碁科技) this year began producing routers and other network gear for Starlink at its factory in the northern Vietnamese province of Hanam, about an hour south of Hanoi, two of the plant’s workers and a contractor said.
Wistron NeWeb’s expansion in Vietnam is largely due to orders from SpaceX, one of the workers said.
The Hanam factory plans to at least double its workforce of 3,000, the contractor and one of the workers said.
Outside the factory, several banners advertised job offers at the plant, reporters observed in the middle of last month.
WNC declined to comment, citing customer confidentiality.
Its latest annual report in April said: “In the face of geopolitical risks and ever-changing customer requirements, WNC has continued to expand its global manufacturing capabilities.”
Universal Microwave Technology Inc (UMT, 昇達科技), another SpaceX supplier and manufacturer of satellite components, invested in a factory in Vietnam this year, according to a Taiwanese official and public documents from the company.
UMT declined to comment on individual customers, citing confidentiality agreements, but said it was expanding its presence in Southeast Asia, including new factories in Thailand and Vietnam.
“The planning of overseas production capacity will help customers reduce their doubts about geographical risks, gain customer recognition and increase the breadth of cooperation with customers,” it said.
Taiwan has a large satellite industry, with about 50 companies producing ground equipment and sensitive components, according to the ministry and industry data.
The government estimates the sector’s output exceeded NT$200 billion (US$6.26 billion) last year.
SpaceX has about a dozen direct suppliers from Taiwan, which rely on dozens of domestic vendors, the source who collaborates with the local satellite industry said.
The Vietnamese government in September said that SpaceX wanted to invest US$1.5 billion in the country, although the timing and purposes of the actual investments remain unclear.
Shenmao Technology Inc (昇貿科技), a supplier of soldering materials for printed circuit boards that has provided components to SpaceX, in April said that it would spend US$5 million to set up a unit in Vietnam, without saying who its clients would be for products from that facility.
The company did not respond to a request for comment.
TRADE WAR: Tariffs should also apply to any goods that pass through the new Beijing-funded port in Chancay, Peru, an adviser to US president-elect Donald Trump said A veteran adviser to US president-elect Donald Trump is proposing that the 60 percent tariffs that Trump vowed to impose on Chinese goods also apply to goods from any country that pass through a new port that Beijing has built in Peru. The duties should apply to goods from China or countries in South America that pass through the new deep-water port Chancay, a town 60km north of Lima, said Mauricio Claver-Carone, an adviser to the Trump transition team who served as senior director for the western hemisphere on the White House National Security Council in his first administration. “Any product going
TECH SECURITY: The deal assures that ‘some of the most sought-after technology on the planet’ returns to the US, US Secretary of Commerce Gina Raimondo said The administration of US President Joe Biden finalized its CHIPS Act incentive awards for Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), marking a major milestone for a program meant to bring semiconductor production back to US soil. TSMC would get US$6.6 billion in grants as part of the contract, the US Department of Commerce said in a statement yesterday. Though the amount was disclosed earlier this year as part of a preliminary agreement, the deal is now legally binding — making it the first major CHIPS Act award to reach this stage. The chipmaker, which is also taking up to US$5 billion
High above the sparkling surface of the Athens coastline, the cranes for building the 50-floor luxury tower centerpiece of Greece’s future “smart city” look out over the Saronic Gulf. At their feet, construction machinery stirs up dust. Its backers say the 8 billion euro (US$8.43 billion) project financed by private funds is a symbol of Greece’s renaissance after the years of financial stagnation that saw investors flee the country. However, critics see it more as a future “ghetto for the rich.” It is hard to imagine that 10km from the Acropolis, a new city “three times the size of Monaco”
STRATEGIC MATERIALS: Taiwan’s advanced chips and tech help the US ‘stay ahead of China in technology competitions,’ central bank Governor Yang Chin-long said The incoming administration of US president-elect Donald Trump is unlikely to impose stiff tariffs on Taiwan’s advanced chips as well as information and communications technology (ICT) products, because they are special and strategic materials the US needs, central bank Governor Yang Chin-long (楊金龍) said yesterday. “Trump’s trade policies may affect Taiwan’s economy and financial markets through multiple channels... We need to be careful in dealing with monetary policy and foreign exchange,” Yang said at a meeting of the legislature’s Finance Committee in Taipei. After Trump’s return to the White House in January next year, it might become normal for Taiwan to be
RSS