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Manufacturing overview of production capacity by end market relocating to South East Asia

By VentureOutsource.com Staff

As trade and tariff strategy continues to influence electronics supply chain decision-making, manufacturing executives responsible for production of auto and auto components proved to be the first to relocate to South East Asia.

Some contract electronics EMS provider capacity has also begun to relocate, particularly to Vietnam, Malaysia and Thailand, according to our findings based on industry discussion and company reports. (View Vietnam analysis here)

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Research findings indicate semiconductor equipment manufacturing appear to be relocating to Malaysia. Relatively diverse production capacity has been relocating to Thailand, including auto and auto components, MLCCs, and optical products, according to company reports.

Singapore could also benefit from high-tech supply chain shifts. Below is a trend analysis of production capacity, by market and products, over the past year. Its easy to see how the progress to shift, and allocate, production has picked up.

Production capacity relocating to ASEAN by quarter of disclosure

SE Asia Vietnam Malaysia Thailand Singapore Indonesia Philippines
1Q18 CPU assembly, auto, auto components CPU assembly Auto, auto components
2Q18 Auto, auto components Auto, auto components Alkaline battery mfg
3Q18 Semi equipment Consumer electronics, auto, auto components Semi equipment
4Q18 Electrical devices, components, optical modules Networking products, routers, optics modules, EMS, components, OSAT Semi equipment, EMS, LED products MLCC, optical, photonic products, EMS, LED products Micro- controllers Components Semi equipment
Jan’19- May’19 Electrical components, footwear, apparel, comm equipment, semi equipment, material handling, machinery EMS, semi equipment, engineered wood, auto- components, home furniture, comm equipment, home improvement tools, toys and games, specialty apparel, LED products, renewable energy equipment, electrical components EMS, home improvement, robots, computer hardware and storage Auto, auto components, LED products Semi equipment Engineered wood, toys,games, apparel Electronic devices, electrical power equipment, electrical components

The above is according to research conducted by J.P. Morgan. Some noteworthy FDI projects emphasizing manufacturing supply chain base relocation include Foxconn and Goertek entering Vietnam in early 2019, Delta moving some production to Thailand, India and Taiwan, and Indonesia seeing Pegatron build a $300 million plant for smart home devices and Hyundai Motor to start producing electric vehicles.

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OEMs reading this can request a list of electronics contract EMS manufacturing providers in Asia (its free) that match your program requirements by clicking here, or you can also click on the map below.

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