Taiwan's Foxconn says global manufacturing footprint to shield it from Trump's tariffs (updated)

Foxconn Technology

27/11/2024 03:49

(Adds quotes, background on Foxconn's manufacturing footprint)
    By Wen-Yee Lee
       TAIPEI, Nov 27 (Reuters) - Taiwan’s Foxconn  2317.TW 
said on Wednesday it expects any impact of new tariffs from U.S.
President-elect Donald Trump to hit it less than its rivals,
citing its global manufacturing footprint. 
    Young Liu, chairman of the contract manufacturer and key
Apple  AAPL.O  supplier, told reporters after a forum in Taipei
that it saw the primary impact of any fresh tariffs falling on
its clients because its business model was based on contract
manufacturing. 
    "Clients may decide to shift production locations, but
looking at Foxconn’s global footprint, we are ahead. As a
result, the impact on us is likely smaller compared to our
competitors," he said. 
    U.S. President-elect Donald Trump said on Monday that on his
first day in office he will impose a 25% tariff on all products
from Mexico and Canada, and will charge goods from China an
additional 10% tariff.
    Foxconn, the world's largest contract electronics maker, has
large manufacturing facilities in China including a giant iPhone
assembly plant. 
    However, it has been increasing its investments in other
countries such as the United States, Mexico, and Vietnam as part
of a supply chain diversification effort. In Mexico, it is
building a large manufacturing facility to produce Nvidia’s
 NVDA.O  GB200 superchips.
    Liu said Foxconn would only be able to share more details
about the company's U.S. plans after Jan. 20, once Trump takes
office and his policies become clearer. "After that, we will
have a corresponding strategy in place,” he said. 
    “What you’re seeing now is a game between nations, not yet
between companies. Whether it’s 25% or an additional 10%, the
outcome is uncertain as they continue to negotiate. We are
constantly adapting and refining our global strategy.”
    During Trump's 2017-2021 presidency, Foxconn announced a $10
billion investment in Wisconsin that the company later mostly
abandoned. On Tuesday, Foxconn said a subsidiary had spent $33
million to acquire land and factory buildings in Harris County,
Texas.
    Foxconn will continue investing in Mexico, Liu added as it
believed the trend was moving towards regional manufacturing. 

 (Reporting by Wen-Yee Lee, Writing by Brenda Goh; Editing by
Muralikumar Anantharaman and Lincoln Feast.)
 ((brenda.goh@thomsonreuters.com; +86 (0) 21 2083 0088; Reuters
Messaging: brenda.goh.thomsonreuters.com@reuters.net))