Taiwan’s Foxconn said on Wednesday it expects any impact of new tariffs from US 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 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.
US President-elect Donald Trump said on Monday that on his first day in office he will impose a 25 percent tariff on all products from Mexico and Canada, and will charge goods from China an additional 10 percent 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 GB200 superchips.
Liu said Foxconn would only be able to share more details about the company’s US plans after January 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 percent or an additional 10 percent, 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 (roughly Rs. 84,425 crore) investment in Wisconsin that the company later mostly abandoned. On Tuesday, Foxconn said a subsidiary had spent $33 million (roughly Rs. 278 crore) 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.
© Thomson Reuters 2024
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