Taiwan New Kinpo Group to ease reliance on China by doubling capacity in Thailand
TAIPEI, NNA – Taiwanese electronics manufacturer New Kinpo Group plans to double production capacity at its Thailand plants for clients who wish to avoid tariffs imposed by the United States on exports from China, the fallout from a protracted trade dispute.
The manufacturer plans to add 500,000 square meters of floor space by the end of 2021, doubling the overall factory area, a New Kinpo Group media liaison told NNA Wednesday. The company will spend $500 million on this expansion from 2020 to 2025 and double staffing to 36,000 people, she said.
The Sino-U.S. trade dispute that broke out in March 2018 has led to U.S. tariffs against $550 billion worth of exports from China to the United States.
From 30 to 35 percent of Kinpo's production capacity in China falls under those tariffs, Taiwanese media China Times quote group president and CEO Simon Shen as saying. Associated costs passed on to clients are motivating those firms to ask that the New Kinpo Group move production outside China, he said.
Extra trade-war linked costs passed on to clients by the group’s China operations have prompted them to move offshore, Shen was quoted saying.
“The phenomenon of the world’s major manufacturers withdrawing from China is expected to prevail in the third quarter next year,” the media reports quote him saying. Supply chains are growing in Thailand for goods such as PC keyboards, and panels, the reports add.
The New Kinpo Group also knows Thai culture after 30 years in the country, another reason to expand there, the media liaison said.