Wed, Jan 22, 2020 - Page 12 News List

Pegatron still studying relocation to Southeast Asia

POTENTIAL SITES:The company refused to comment on a Bloomberg report that it would produce styluses for Samsung, saying that it seeks to serve many clients

By Natasha Li  /  Staff reporter

Pegatron Corp (和碩), an assembler of Apple Inc’s iPhones, yesterday said that it is still studying the feasibility of relocating production from China to Southeast Asia, dismissing a media report that it has chosen Vietnam as a second manufacturing site.

“We are still assessing potential production sites across the Southeast Asian region, as there are many factors to consider,” a company official told the Taipei Times by telephone.

The official spoke on condition of anonymity.

Bloomberg News yesterday reported that the company intended to set up production facilities in Vietnam, citing people familiar with the matter.

Pegatron reportedly rented a plant in Hai Phong, 100km from Hanoi near Vietnam’s northeast coast, where it would produce smartphone styluses for Samsung Electronics Co.

Samsung makes about one-third of its mobile phones in Vietnam’s northeastern province of Thai Nguyen.

Pegatron refused to comment on the report, saying that it would serve more than one client as it seeks to penetrate deeper into Southeast Asia.

To avoid US tariffs on China-made products, Pegatron last year set up a plant on Batam Island in Indonesia, its first in the region, where mass production began in July.

The location was chosen mainly for its proximity to Singapore and its status as a free-trade zone, the company said at the time.

The facility, in which the company invested US$40 million, specializes in the assembly of network and communication products, as well as smart devices powered by Internet of Things technology.

Pegatron might also seek to relocate part of its China production to India, based on demand from its clients, chief executive officer S.J. Liao (廖賜政) told investors at an earning conference more than two months ago.

Industry peers, including Hon Hai Precision Industry Co (鴻海) and Wistron Corp (緯創), last year set up iPhone assembly lines in India.

Separately yesterday, contract electronics manufacturer Inventec Corp (英業達), which assembles Apple AirPods, said that its board of directors had approved an expansion plan in Mexico.

The company, which previously rented facilities in the North American country, said that it would purchase land to build a new server plant to meet rising orders.

Inventec has also announced that it has purchased land to expand production in Georgetown in Malaysia’s Penang state, on behalf of its smart device manufacturing arm, Inventec Appliance Corp (英華達).

The company is relocating its PC production from Chongqing, China, to Taoyuan’s Dasi District (大溪) to alleviate the effects of US tariffs on its Chinese production.

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