Foxconn Technology Group (富士康科技集團) is planning to open an iPhone manufacturing facility in Vietnam to mitigate the effects of the US-China trade spat, the Vietnam Investment Review reported yesterday.
Foxconn, known as Hon Hai Precision Industry Co (鴻海精密) in Taiwan, has begun talks with the Hanoi People’s Committee, Vietnam Chamber of Commerce and Industry director Vu Tien Loc was quoted as saying in the report.
Last month, US President Donald Trump suggested that 10 percent tariffs could be placed on mobile phones and laptops made in China, further straining companies in Apple Inc’s supply chain amid slowing smartphone sales around the globe.
Samsung Electronics Co makes about one-third of its smartphones in Vietnam and the arrival of Foxconn could displace the South Korean giant’s position as the leading smartphone manufacturer in the country, said Tran Toan Thang, director of the Vietnamese National Center for Socio-Economic Information and Forecast.
Samsung and its local suppliers could also face greater difficulties in hiring workers following Foxconn’s arrival, as there is no longer an excess of workers in Vietnam, Tran said.
The arrival of another major foreign smartphone manufacturing firm in Vietnam could bring more opportunities for Vietnamese suppliers, Tran said.
“As there are more suppliers than it needs, Samsung has had the luxury of cherry-picking its local partners,” Tran was quoted as saying.
Meanwhile, FIT Hon Teng Ltd (鴻騰), Foxconn’s Hong Kong-listed subsidiary, last month also announced that its board of directors has proposed making a capital injection of US$130 million in New Wing Interconnect Technology (Bac Giang) Ltd, a wholly owned unit based in Vietnam. Bloomberg has reported that Foxconn is planning to cut costs by 20 billion Chinese yuan (US$2.9 billion) and to cut its non-technical workforce by 10 percent as wage levels rise in China.
However, Taiwanese contract electronics manufacturer Pegatron Corp (和碩) chairman Tung Tzu-hsien (童子賢) last month said that it would take up to five years for Southeast Asian nations to replace China’s leading position as a supply chain hub.
In terms of market size and infrastructure, China cannot be easily replaced by Southeast Asia, Tung said on the sidelines of a consumer electronics exhibition in Taipei.
He said that there are more considerations than cheap labor, adding that wage levels in Southeast Asia have also been rising amid rapid economic growth in the past few years.
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said second-quarter revenue is expected to surpass the first quarter, which rose 30 percent year-on-year to NT$118.92 billion (US$3.71 billion). Revenue this quarter is likely to grow, as US clients have front-loaded orders ahead of US President Donald Trump’s planned tariffs on Taiwanese goods, Delta chairman Ping Cheng (鄭平) said at an earnings conference in Taipei, referring to the 90-day pause in tariff implementation Trump announced on April 9. While situations in the third and fourth quarters remain unclear, “We will not halt our long-term deployments and do not plan to
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
RSS