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Pegatron Seeing Vietnam as its New Production Base

Pegatron Corp. plans to initiate production in Vietnam. The company is seeking to create its presence in Southeast Asian regions as efforts push its boundaries beyond China, said sources familiar with the matter.

The Taiwanese electronics manufacturing company is searching for a site in the north to form a new manufacturing unit. The company has also rented an additional manufacturing base in the northern city of Haiphong, the people said. The rented manufacturing base will produce styluses for Samsung Electronics’s smartphones.

Hon Hai Precision Co. and Wistron Corp. are two other assemblers who are also coupled with Pegatron in building a manufacturing base in Vietnam. Pegatron is the only one that will be producing iPhones in Vietnam, and the other two have no plans to do so, sources said.

More assemblers, including Compal Electronics Inc. and Lux Precision Company, are based in Vietnam, and AirPods maker GoerTek also belongs to Vietnam.

The international trade dispute between the U.S. and China affected Chinese industry and its position as a factory for the world. It also excavated China’s supply chain and prompted companies to seek alternatives to their production bases. Even as Beijing and Washington have signed a trade deal, supply-chain diversification has become a requisite to lessen the long term stress and surging labor costs in China.

A number of Taiwan-based companies such as Inventec Corp and Foxconn Group have been actively searching for options to move their production houses around Asia to avoid heavy U.S. tariffs.

Vietnam spending enduring efforts to train its workers to boost the quality of their work; its administration also removing obstacles such as bureaucracy for companies from overseas, said a researcher elaborating Vietnam’s strives to enhance overall trade structure.

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Frank Luna

I have more than a decade of experience in market research. I also have a degree in Business Administration with a concentration in Marketing and Finance. I have been engaged in evaluating the influence of e-commerce opportunities, monitoring, and forecasting of sales trends, performing a valid and reliable SWOT analysis.

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