The US tariffs are ravage. At the beginning of last April Donald Trump announced that His administration was going to impose tariffs to the importation of products from Most countries with those that the US holds a commercial relationship. China was one of the nations They left worse stops, as expected, which caused governments led by Donald Trump and Xi Jinping to engage in an unprecedented climb of tariffs.
In a few days the US administration approved China tariffs of 145%and this last country responded with 125% taxes About US assets. This scenario was unsustainable, so after negotiating both governments they agreed to moderate their tariffs temporarily at 30% and 10% respectively. This is how the panorama is currently, but these two countries will renegotiate these conditions as very late in November. Anyway, 30% tariffs are subject to the products that arrive in the US from China are damaging many companies. Asus is one of them.
Thailand, Indonesia and Vietnam are the big beneficiaries, for the moment
Asus is a Taiwanese company, but until just a few weeks most of its production came from continental China. This company is one of the largest manufacturers of motherboard and other components for PC of the planet, and the US is one of its main markets. It is very difficult to specify what weight sales in the country led by Donald Trump in the face of their total sales, but we know that in 2023 the American continent represented 23% of the total income of ASUS. And with all probability USA exercised a very important contribution to this figure.
“At this time more than 90% of our production has already been distributed to these new regions”
Losing its position in the US market is not an option for this Taiwanese company. Their products manufactured in China receive a surcharge when they arrive in the US of 30%, as we have seen, so Asus has made a decision: It is moving 90% of its production outside of China. It is the only effective strategy when avoiding US tariffs. “We are expanding our production bases in Southeast Asia beyond China for both the mother -and -fashioned PCs. We are installing in Thailand, Indonesia and Vietnam (…) at this time more than 90% of our production has already been distributed to these new regions,” has declared A spokesman for Asus.
The choice of Thailand, Indonesia and Vietnam is not accidental. Production costs in these three countries are moderate, presumably as much as in China, so Asus’s competitiveness is not going to resent. It is great news for us, users. If this reorganization of its production chain had an upward impact on the cost of their products, consumers would pay it. All consumers, not just those of the US. But a priori this will not happen because manufacturing in Thailand, Indonesia and Vietnam It is no more expensive than doing it in China when the combination of lower wages and the ability to avoid high tariffs in key markets are considered.
Image | Andrey Matveev
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