HP Eyes Thailand In Plans To Shift Production From China
Trade tensions have spooked several businesses including HP, leading to relocating production facilities out of China. This time, Southeast Asia is the manufacturing hub of choice, according to the Nation, Thailand.
Corporations such as Samsung, Nike, and Adidas have reportedly moved substantial portions of their production to countries like Vietnam and Indonesia. Samsung relocated its smartphone manufacturing to Vietnam, where it now contributes significantly to the country’s GDP.
Nike has shifted a considerable part of its footwear production to Vietnam as well, where over half of its shoes are now made. Meanwhile, Adidas has reduced its reliance on Chinese manufacturers, turning to alternatives in Southeast Asia. Even Apple is looking to Indonesia for its manufacturing facility.
Vietnam, Indonesia, and Thailand are among the key destinations attracting these relocations, offering lower labour costs, expanding manufacturing capabilities, and favourable trade agreements. Hyundai Motor Company will invest THB1 billion (US$28 million) to set up a facility to assemble electric vehicles (EVs) and batteries in Thailand, the country’s Board of Investment (BOI) said on 7 August 2024, according to Bangkok Post.
These moves are part of a broader shift as companies seek to mitigate risks associated with over-reliance on China and leverage the growing economic potential of Southeast Asia. Tensions over Taiwan pushing Hewlett-Packard to move a significant proportion of PC production from China, Nation Thailand quoted Nikkei Asia.
US-based IT giant Hewlett-Packard (HP) is looking to shift more than half of its PC (personal computer) production away from China to reduce potential geopolitical risks. HP also plans to set up a backup design hub in Singapore, the report said.
Nikkei Asia cited multiple sources as saying that HP is in talks with suppliers about the move and aims to achieve its target in two to three years. The company has set an internal goal of eventually making up to 70% of its notebooks outside of China.
A major destination for the move is Thailand, said the report, adding that at least five HP suppliers are building new manufacturing facilities or warehouse hubs in the kingdom, and two have been increasing capacity there since the beginning of the year at HP’s request.
Nikkei Asia quoted an executive-level source as saying:
“It is certain that HP is betting big on building a production hub in Thailand. We have other Southeast Asian facilities to support the client, but they said it is not efficient enough, so we are building a new factory in Thailand now, as requested.”
Other sources said that in internal talks, several HP executives have been emphasising the emerging business opportunities in Southeast Asia and the Middle East while flagging the geopolitical risks of keeping production centered in China, due to years of US-China tensions as well as disruptions from Covid.
What You Missed:
Hyundai To Invest US$28 million In Thailand For EV Assembly And Batteries
Industrial Automation Redefined: Insights From ARC Industry Leadership Forum
Malaysia Sets Its Eyes On Medical Devices Manufacturing Market
Singapore Prepares More Land To Woo Semiconductor Giants Looking To Ride AI Wave
Chinese Enterprises Also Eye Manufacturing Opportunities In The Philippines
More Factories Relocate From China To Malaysia Over Restrictions
LG-Hyundai Electric Car Battery Factory To Open On 3 July 2024
Chinese Automakers Double Down On Presence In Thailand
Hitachi Industrial Equipment Systems’ ML Predictive Diagnosis Service For Air Compressors
TSMC Sees Annual Sales Growth To Reach 10% In Semiconductor Industry
WANT MORE INSIDER NEWS? SUBSCRIBE TO OUR DIGITAL MAGAZINE NOW!
CONNECT WITH US: LinkedIn, Facebook, Twitter
Letter to the Editor
Do you have an opinion about this story? Do you have some thoughts you’d like to share with our readers? APMEN News would love to hear from you!
Email your letter to the Editorial Team at [email protected]
