Tuesday, July 9th 2019

Microsoft Won't Move Production Out of China

Previously, we have reported that major OEMs are looking and exploring for ways of moving production outside of China, into other Asian countries, because of tariffs imposed by US-China trade war and rising labor costs. The original report from Nikkei specifically indicated that Microsoft will move its Xbox and Surface manufacturing to Thailand and Indonesia, while the production in China would stop.

However, Tom's Hardware had a conversation with Microsoft regarding the situation and the outcome was contradictory to the report of Nikkei. Microsoft told Tom's Hardware "that there currently aren't any plans to do so", which means that current manufacturing facilities are there to stay. We still don't know how will the rest of OEMs react or comment, but HP also said to Tom's that it shares industry concerns and will not comment any further to the rumors, adding that tariffs are hurting consumers.
Source: Tom's Hardware
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5 Comments on Microsoft Won't Move Production Out of China

#1
Vayra86
Of course not. Cheap labor is cheap labor and that is all, the only thing these companies are looking at for moving production is additional cost and uncertainty - and with that, a decline in how competitive they can be.
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#2
Deathy
Getting manufacturing of this magnitude started is costly. In not so advanced countries doubly so. Not to mention, they might not even have enough labour, meaning more and costlier robots. So this would easily cost hundreds of millions, more likely billions to get going. If there is one thing about China, it is a pretty stable country. Thailand and Indonesia have more troubles, other Asian countries as well. And this whole trade war might be over more quickly than you think (either by electing another president of by negotiations).
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#3
z1n0x
I'm truly surprised.

Posted on Reply
#4
Vayra86
Deathy, post: 4077553, member: 181802"
Getting manufacturing of this magnitude started is costly. In not so advanced countries doubly so. Not to mention, they might not even have enough labour, meaning more and costlier robots. So this would easily cost hundreds of millions, more likely billions to get going. If there is one thing about China, it is a pretty stable country. Thailand and Indonesia have more troubles, other Asian countries as well. And this whole trade war might be over more quickly than you think (either by electing another president of by negotiations).
Spot on. This is all about the long term - ie 5~10 years or more.
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#5
AsRock
TPU addict
z1n0x, post: 4077577, member: 188730"
I'm truly surprised.


HA, things you can do right when your a trillion dollar company huh.

Maybe no one else want's to make laptops made of carpet :P.
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