Google is reportedly contemplating a move away from China in producing its Pixel phones, and is said to be all set for moving a significant line of its Pixel production from China to Bac Ninh, Vietnam, by taking over an old production factory that previously belonged to Nokia. Multiple factors are believed to be at play here. For one, the tariff and trade war that was started by US president Donald Trump is showing its impact, where companies are now being forced to look at markets apart from China in order to maintain their margins.
According to the report, Google is looking to double the total number of Pixel phones that it produces each year, up to nearly 10 million units for the year. Its initial shift away from China will seemingly see the Pixel 3a production move to Vietnam, while the Google Home speaker is being shifted to Thailand. From what it seems, the production of the new Pixel devices will still be based in China, at least for the time being. Google is looking to make a strong statement as a hardware vendor as well, and while software remains its primary business, this year's Pixel is reported to spot significant upgrades, cementing Google's intent as a smartphone OEM.
Almost 70 percent sales of the Google Pixel is based in its home nation USA, where it has finally managed to enter the top five smartphone vendor rankings in various market reports. However, with Trump's imposition of special tariffs and the rising cost of labour in China, many companies are being forced to look elsewhere in order to diversify production of hardware.
A point in hand is Google's rival Apple, which was directly addressed by Trump as he went about urging everyone to move production out of China. Apple remains heavily reliant on its Chinese production chains, and while it is looking at other markets including India for sending some of its Chinese production volumes offshore, the established chain in China is far too deep to simply do away with. Even laptop manufacturers Dell and HP are believed to be looking at the likes of Thailand and Taiwan for other manufacturing lines.
Given the present political climate surrounding global trade and hardware manufacturing, it remains to be seen how companies manage their reliance on China when it comes to producing units. For Google, the company is beginning slow in terms of moving business out of China, but as of now, it seems like the production volume will remain in China, for the larger part.