The political trade war between the United States and China is continuing to spill over into the tech industry. According to sources, Microsoft, Amazon, and Google are seeking to move their manufacturing away from Chine.
Nikkei Asian Review reports the tech giants are already scouting new production locations in other Asian countries. China handles many manufacturing operations for Google, Microsoft, and Amazon.
Apple has already suggested it will move production out of the country, with between 15% and 30% of manufacturing likely to leave the country.
Amazon is reportedly going to remove its Echo speaker production to Vietnam, according to the report. As for Microsoft, the company is looking to Thailand and Indonesia to become the core of manufacturing for its Xbox consoles.
Google's preferred location away from Chine is unknown, but the company is said to be scouting locations for Google Home speaker production.
It's interesting that companies should be seeking to move away from China. If this is the case, it is unlikely to be related to any agreement with the tariffs imposed by the Trump government. However, companies may be concerned that China will become an expensive place to manufacture products.
Just last week, the industry leading console companies penned an open letter criticizing the U.S. government's tariffs.
“The video game console supply chain has developed in China over many years of investment by our companies and our partners,” the companies wrote. “It would cause significant supply chain disruption to shift sourcing entirely to the United States or a third country, and it would increase costs—even beyond the cost of the proposed tariffs—on products that are already manufactured under tight margin conditions.”