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Taiwan's Foxconn mulls Vietnam iPhone factory to sidestep trade war: reports

Foxconn in talks with Vietnamese government about potential factory

Foxconn factory

Foxconn factory (Wikimedia Commons photo)

TAIPEI (Taiwan News) – Foxconn Technology Group, the world's largest contract electronics manufacturer, is reportedly mulling over a new iPhone factory in Vietnam to sidestep rising tariffs of the U.S.-China trade war.

Foxconn is in talks with the Hanoi People’s Committee about the potential factory, reported Vietnam Investment Review.

U.S. President Donald Trump suggested last month that a 10 per cent tariff could be applied to Chinese-made smart phones and laptops.

Analysts suggest that if the U.S. imposes a 25% tariff on Chinese-made smartphones, higher supply chain costs will make manufacturing in China unviable for some companies.

Foxconn has a manufacturing presence in Vietnam, where the company manufactures Nokia branded telephones. Sharp Group, which is owned by Foxconn, also has a manufacturing presence in Vietnam.

The manufacturing switch depends on how the U.S.-China trade war unfolds, and Foxconn is currently evaluating the style and extent of a potential move, reported United Daily News.

The Vietnam Investment Review suggests a potential entry by Foxconn will shake-up the smartphone manufacturing sector in Vietnam, which is dominated by Samsung, and will bring about greater competition for labor and more business for local suppliers.