HP and Dell may sharply cut China production to dodge tariffs

Although the United States has temporarily agreed not to impose new tariffs on Chinese exports, electronics vendors are still looking to take some production elsewhere. Citing unnamed sources, Nikkei reports that HP and Dell—which ship a combined 40% of all personal computers—plan to move up to 30% of laptop production out of China and into other countries such as Taiwan, Vietnam, Indonesia, and the Philippines. Amazon, Google, Microsoft, Nintendo, and Sony are also drawing up contingency plans, as are other laptop makers such as Acer and Asus. Nikkei also reported that Apple has explored moving up to 30% of smartphone production to other countries.

While new tariffs would be the main impetus for any production shifts, electronics companies may also be looking to exploit cheaper labor in other countries. One economist told Nikkei that rising labor costs are a concern for electronics vendors, who could push ahead with more production outside China regardless of whether President Trump gets his trade deal.

Source: FastCompany

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