2017 was a watershed moment for Taiwanese industry: with the US-China trade war heating up, the Taiwanese electronics suppliers, previously having their assembly lines concentrated in China, have begun to switch to Southeast Asia in the effort to diversify risk. Previously, Taiwanese investments in Southeast Asia had been focusing on labor-intensive sectors, but the pivot to Southeast Asia slowly gained momentum as China gradually moved its coastal industries away from their labor-intensive nature.
Major Taiwanese system integrators like Foxconn Technology Group, Pegatron Corp. and Wistron Corp. have all ride on the trend, expanding their presence in Southeast Asia. An electronics industrial cluster is soon expected in northern Vietnam.
Since 2010, Taiwanese investment in Southeast Asia has been steadily growing, with Vietnam, Thailand and Indonesia topping the list. In the span between 2010 and 2020, it was estimated that approximately half of Taiwanese electronics manufacturers’ investments had gone to Southeast Asia.
However, Taiwanese electronics industry hasn’t completely relocated its assembly lines out of China, with some maintaining factories dedicated to the local market. Nevertheless, a trend of regionalization has increasingly replaced globalization when it comes to the distribution of Taiwanese supply chains.