Tech Suppliers in Southeast Asia Face Tougher Competition as China Expands Presence
Chinese tech suppliers are entering Southeast Asia, challenging Taiwanese and other rivals. Google is shifting production of Pixel watches to a Chinese supplier in Vietnam. Chinese companies are bidding to produce Pixel phones in Southeast Asia.
Google, in an effort to diversify its production away from China, has asked its Chinese supplier Goertek to manufacture Pixel watches in Vietnam. This is a departure from relying solely on Taiwanese companies for assembly.
BYD, a Chinese company, is also bidding to make Pixel phones in Southeast Asia, adding to the competition in the tech supply chain.
Southeast Asia has emerged as a manufacturing powerhouse thanks to its closeness to China and reduced labour costs. Chinese technology suppliers have been aggressive in setting up facilities in the region, with a strong presence in Vietnam.
Chinese corporations not only offer reasonable costs, but they also benefit from strong diplomatic ties with local governments, providing them an advantage in attracting business.
The battle is expected to heat up as Chinese companies want to expand internationally in order to earn more foreign currency and return those gains to China.
Chinese vendors are losing their image for low cost and low quality, as their products increasingly meet rigorous standards.
Non-Chinese providers in Southeast Asia face increasing rivalry for workers, land, and customer orders.
The printed circuit board (PCB) industry is very competitive, with a large number of Chinese PCB manufacturers investing in Thailand.
Suppliers are struggling to make use of their existing capacity, as they are caught between investing in abroad capacity and facing a shortage of orders in China.
Chinese technology suppliers have made major investments in Southeast Asia, overtaking Singapore as the region's leading source of foreign investment.
Chinese tech suppliers are entering Southeast Asia, challenging Taiwanese and other rivals.
Google is shifting production of Pixel watches to a Chinese supplier in Vietnam.
Chinese companies are bidding to produce Pixel phones in Southeast Asia.
Source: NIKKEI ASIA