Thursday, July 4th 2019
Major American OEMs to Move Some Manufacturing Out of China
Major American PC and consumer-electronics OEMs, namely Dell, HP, Microsoft, and Amazon, are reportedly moving some of their manufacturing out of China, in the wake of the ongoing US-China trade-war, an offshoot of which inflicts import-tariffs on a spectrum of products imported from China. This impacts China as a destination for manufacturing. According to Japanese business publication Nikkei, HP and Dell are each moving 30 percent of their laptop manufacturing volume out of China. This roughly aligns with their volumes bound for the US market. They could continue manufacturing in China for volumes headed to other markets.
Currently, the U.S. Government imposes import tariffs on $200 billion worth goods imported from China, and fully built PCs were immune to these tariffs. This has had an adverse and unfair impact on U.S.-based system integrators such as OriginPC, Falcon Northwest, etc., who import components and assemble gaming PCs and notebooks on U.S. soil, on a build-to-order basis. A new round of import tariffs proposed by Washington changes this, and brings even fully-built laptops, smartphones, and gaming consoles under the ambit of import tariffs. This explains why Microsoft and Amazon are eager to change their manufacturing landscapes. Microsoft makes its Surface line of premium portable computers, and Xbox game consoles in China, while Amazon makes a vast array of IoT products under its main brand, and various knick-knacks under its Amazon Basics brand.
Currently, the U.S. Government imposes import tariffs on $200 billion worth goods imported from China, and fully built PCs were immune to these tariffs. This has had an adverse and unfair impact on U.S.-based system integrators such as OriginPC, Falcon Northwest, etc., who import components and assemble gaming PCs and notebooks on U.S. soil, on a build-to-order basis. A new round of import tariffs proposed by Washington changes this, and brings even fully-built laptops, smartphones, and gaming consoles under the ambit of import tariffs. This explains why Microsoft and Amazon are eager to change their manufacturing landscapes. Microsoft makes its Surface line of premium portable computers, and Xbox game consoles in China, while Amazon makes a vast array of IoT products under its main brand, and various knick-knacks under its Amazon Basics brand.