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Google & Microsoft Pull The Plug On ‘Made In China’

Google and Microsoft cannot get out of China quick enough with both Companies now working overtime to shift production of their hardware products away from Chinese manufacturing plants according to Asian Nikkei Review.

The two US tech Companies are set to move their manufacturing to Vietnam and Thailand.

Google is set to begin production of its latest low-cost smartphone Pixel 4A in northern Vietnam as soon as April.

Google also plans to manufacture its next-generation flagship device the Pixel 5 at the same plant.

Microsoft, which began its foray into PC hardware in 2012, is scheduled to start producing its Surface line, including notebook and desktop computers, in northern Vietnam in the second quarter of this year.

Samsung is already manufacturing products including their new Galaxy smartphones in Vietnam.

The world’s largest smartphone maker has operated a smartphone supply chain in northern Vietnam for years but still relies on some components made in China.

The South Korean company had even planned to fly electronics components for its smartphones from China to Vietnam after the border crossings of the two countries were temporarily closed to prevent the spread of the virus, the Nikkei reported.

Google has also asked a long-time manufacturing partner in Thailand to reactivate production lines for several new Google smart products such as voice activated speakers and Nest Mini. The first products are expected to start shipping in the first half of 2020, the sources said.

The ANR said that until now, most if not all Google smartphones and Microsoft-built computers have been made in China.

The U.S.-China trade war caused many industries — especially technology — to consider the risks of overreliance on China for manufacturing.

Chinese shoppers try out Microsoft Surface Pro tablet PCs at a home appliances store in Beijing, China, 2 April 2013.
Microsoft launched the Surface Pro in China on Tuesday (2 April 2013) and with it, a special version including a copy of Office Home & Student 2013. Microsoft is hoping to build momentum behind its Surface Pro tablet in China by launching a special edition including Office Home & Student 2013, but with Windows 8 Standard, rather than Windows 8 Pro. The companys Surface Pro 128 GB version goes on sale in the country on Tuesday. But along with it, the U.S. tech giant is also releasing an exclusive Surface China Edition, with an x86 processor like its Pro cousin, the company announced. Unlike the Surface Pro tablet, the China Edition comes with the standard Windows 8 OS rather than the Professional version. In addition, it only supports the simplified Chinese language. But the tablet also contains Office Home & Student 2013, a product suite Microsoft excluded from its Surface Pro tablet in favor for a one-month trial of Office 365 Home Premium. The Surface China Edition will be available in 64 GB and 128 GB versions for 6,588 yuan (US$1,050) and 7,388 yuan (US$1,178), respectively. The Surface Pro will be priced at 7,388 yuan.

The coronavirus has only added to concerns about concentrating production too heavily in one place.

“The unexpected coronavirus hit will definitely push electronics builders to further seek production capacity outside their most cost-effective production base of China,” a supply chain executive said. “No one could ignore risks after this. … It’s more than just cost — it’s about continuity of supply chain management.”

Google even asked its suppliers to evaluate the feasibility and cost implications to uninstall some production equipment and ship it from China to Vietnam via land, sea or air transportation after virus fears left production facilities unable to immediately return to work in February, one of the sources briefed on the matter said.

The Vietnamese government in early February suspended entry of Chinese nationals and foreigners who have visited China in the past 14 days to prevent the virus spreading. Hanoi has also suspended passenger flights to and from China and halted train transportation between the two countries, posing additional challenges for suppliers to ship components to the Southeast Asian country.

 

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