Secure Your Manufacturing Future Beyond China
The complex interplay of economic, demographic, and geopolitical factors necessitates a strategic approach for manufacturers currently reliant on China. The economic stability, favorable demographic trends, and business-friendly environments of Southeast Asia and South Asia, particularly in Thailand, Vietnam, and India, offer compelling alternatives.
These locations provide significant advantages, including robust growth potential, competitive labor costs, and supportive government policies. Each country has its own unique strengths, making it essential to consult with experts before deciding on a new location.
Immediate Action Required
OEMs need to act now—waiting until the November election is too late. As we have stated above, several factors will make future project placements increasingly challenging:
-
- Factory Capacity: The best factories will fill up quickly. Delaying could result in having to work with less desirable manufacturing partners.
- Predatory Pricing: Factories price to market, and without a head start, you may face prices that benchmark against China + 60%, not just China.
- Potential EU Tariffs: These could further decrease available capacity.
- China +1 Orders: The surge of China +1 orders following the tariffs will consume a significant portion of available capacity.
- Tariff Costs: Importers have already paid substantial tariffs since the trade war began. Acting now can prevent further financial strain.
- Lead Time: The process of making tooling, obtaining T1 part approval, and the combined production and shipping time can take up to 6-8 months before full production orders begin to be delivered.
Proactively diversifying supply chains and relocating can mitigate the risks associated with over-reliance on China and leverage the opportunities in dynamic and growing markets. This strategic shift not only enhances supply chain resilience but also positions OEMs for long-term success in the evolving global landscape, particularly in areas like metal component manufacturing and machining components.
Align Manufacturing: Your Boots on the Ground in South & Southeast Asia
We encourage OEMs to take immediate action to diversify their supply chains into South and Southeast Asia. By partnering with Align Manufacturing, companies will receive comprehensive support services and local expertise throughout the transition process.
For more information and to start your transition with Align Manufacturing, please visit our website or contact us directly. Let us help you relocate your contract manufacturing operations for sustained success in new and exciting markets.
About Align Manufacturing:
Align Manufacturing, headquartered in Singapore and with offices in Bangkok, specializes in delivering high-quality industrial production solutions. Our expertise ranges from intricate sand casting and robust forging to efficacious stamping and state-of-the-art precision machining. This diverse capability ensures that we meet the complex needs of our clients with meticulous attention to detail and seamless communication. Partner with Align Manufacturing for efficient and precise manufacturing outcomes tailored to your project's success.
Note:
This article is part of an ongoing series exploring why US-based companies need to move their manufacturing operations outside of China.
To read the previous article, click HERE.
To download the entire series as a report, click the button below.
