Google is reportedly shifting its Pixel smartphone production along with Google Home, to an old Nokia factory in Northern Vietnam. Samsung developed a smartphone supply chain in the area a decade ago, giving Google an experienced workforce to pull from.
The shift came as a result of rising Chinese labor costs, as well as added burden from tariffs due to the ongoing U.S.
Sources claim that Google also plans to eventually move most production for hardware intended for the USA market out of China and into Vietnam, including the Google Home line of smart speakers.
Between 8 million and 10 million smartphones are expected to be shipped by Google to Vietnam this year, or two times more compared to 2018. This would include Google Nest products as well as Pixel smartphones.
The mid-priced Pixel, launched in April, helped Google develop into the fifth largest cellular model within the USA for the second quarter of 2019, grabbing market share regardless of a wider trade stoop.
By diversifying its manufacturing into Vietnam, Google hopes to make sure sustainable manufacturing of the Pixel vary, a showcase for its Android working system.
Google is not the only United States company looking to become less reliant on China.
Google is not abandoning China completely, one of the sources said. That raises the possibility that Google's soon-to-be unveiled Pixel 4 line could be at least partially made in the country as well.
For its smart speakers, some production is likely to be moved to Thailand, sources said.
Following a summer of teasing images and pre-announcing new features for the Pixel 4, which is expected to launch in October, alleged photos of the Android phone in the wild have now surfaced. The US applies duties of up to 25 per cent on a number of imported Chinese goods while China retailed by applying five to 25 per cent tariff on US products. Right now, Google's smartphone business is relatively small and easy to move.
Google was not immediately available for comment when contacted by Business Insider.
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