Trade War: Taiwan firms Pegatron, Quanta, Wistron, others may shift production out of China

Many companies face uncertainty in China, may return production to Taiwan, or seek to establish a presence in SE Asia

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A Pegatron facility in Pudong, Shanghai.

A Pegatron facility in Pudong, Shanghai. (By Associated Press)

TAIPEI (Taiwan News) – As the U.S.-China Trade war continues to escalate, the Ministry of Economic Affairs has seen a marked increase in companies considering withdrawing manufacturing bases from China.

Subsequent reports now suggest that Taiwanese companies Quanta Computer (廣達電腦), and Pegatron (和碩), facing potential losses, may soon decide to return production facilities to Taiwan.

The Wistron (緯創) Corporation may also be preparing to restart production at a facility in the Philippines that has been shuttered for 14 years, reports LTN.

Quanta Computers largest production base is currently located in China, but some aspects of its production line may be shifted back to Taiwan in the future, However, according to a company spokesperson, if the U.S. China trade war continues, then the company will suffer no matter if the production is in Taiwan or China.

Meanwhile, Pegatron earlier this year purchased a major telecommunications equipment manufacturing facility in Taiwan from Arris International, before deciding to transfer all of its production facilities to a new factory in Suzhou, China.

Now with the U.S.-China trade war ramping up, Pegatron is uncertain about the future sustainability of its production operation in Suzhou. If the U.S. targets telecommunications equipment, Pegatron may have no choice but to consider other options outside of China.

The Wistron Corporation over the years 2003 and 2004 shifted all of its production from a facility in Subic Bay of the Philippines to a facility in Zhongshan, China, leaving only a technical support and customer service center in the Philippines. However, 14 years later, facing uncertainty in China, there are reports that Wistron is considering returning production operations to the Subic Bay facility.

Recent reports state that other Taiwanese companies like Delta Electronics, New Kinpo Group, and Merry Electronics have all begun shifting some of their Chinese manufacturing to Southeast Asia, in expectation of a potentially protracted trade war between the U.S. and China.  

LTN reports that when making new deals for major purchases or new partnerships, major brand customers and partner companies have reportedly begun asking Taiwanese firms “does the company have production facilities outside of China?”