Amazon, Microsoft, and Google plot to pull product manufacturing out of China, deepening the cold war engulfing tech

STR/AFP/Getty ImagesChina is facing an exodus of electronics production.
  • Google, Amazon, Microsoft, Dell, and HP are all drawing up plans to move huge chunks of production out of China, Nikkei Asian Review reports.
  • For Google, Amazon, and Microsoft the main areas of concern are gaming consoles, e-readers, and smart speakers. For Dell and HP, notebooks are where they’re looking to shift production.
  • Nikkei Asian Review has also reported that Apple wants to reduce its exposure to China because of uncertainty around the trade war.
  • Visit Business Insider’s homepage for more stories.

The US tech giants Google, Amazon, Microsoft, Dell, and HP are all gearing up to start shifting production away from China amid the trade war, Nikkei Asian Review reports.

Citing multiple sources, Nikkei reports that the five companies have been scouting various other Asian countries as possible new homes for electronics production.

This is the latest chapter in the tech cold war that has snowballed substantially amid President Donald Trump’s trade war with China.

Nikkei reported last month that Apple was seriously considering moving 15% to 30% of its iPhone production out of China, an early sign US companies wanted to reduce their exposure to the country.

Google, Amazon, and Microsoft

Game consoles and smart speakers are the primary concern for the Silicon Valley giants Google, Amazon, and Microsoft – along with Sony and Nintendo.

Amazon EchoShutterstock

Amazon is looking at moving production of its e-readers and Echo smart speakers to Vietnam, Nikkei said. Microsoft is weighing up Thailand and Indonesia, presumably for production of the Xbox as well as its lesser-known Cortana speaker.

Read more:
Here are the US states that could be hit hardest by the “tech cold war”

Nikkei gave no details about where Google might consider moving production of its Google Home smart speakers.

US tariffs pose an existential threat to video game consoles. Last week, Sony, Microsoft, and Nintendo wrote a joint letter to the US government asking that game consoles be left off any tariff lists because of the “disproportionate harm” tariffs would cause to US consumers and business.

Dell and HP

For Dell and HP, notebook computers are the main area where the companies are said to be looking to move production. The two companies shipped a combined 70 million notebook devices last year, according to Nikkei, most of which were made in China.

Dell is already trialing notebook production in Taiwan, Vietnam, and the Philippines, Nikkei said, citing two people familiar with the plan.

Two sources also told Nikkei that HP was looking to shift 20% to 30% of production out of the country and was considering Thailand and Taiwan as alternatives. One source said the changes could begin as early as late July but were still liable to change.

Google, Amazon, and Dell were not immediately available for comment when contacted by Business Insider. Microsoft and HP declined to comment on the report, although an HP spokesman said in a statement: “HP shares industry concerns that broad-based tariffs harm consumers by increasing the cost of electronics. We are actively monitoring the situation and will continue to work with government officials to advocate for the best interests of customers, partners and consumers.”

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