Amidst the on-going trade war between the US and China, Korean electronics giant Samsung is already planning on moving one of its manufacturing plant out of the Chinese mainland. To that end, the brand has reportedly begun laying off many of its staff currently under the employment of said factory.
According to a Chinese report, the layoff began earlier in March this year, with Samsung halting recruitment to the plant back in March. While it isn’t explicitly mentioned, some people with knowledge about the issue says that the factory in Huizhou will be fully closed by September.
Samsung’s manufacturing plant, which is located in the Huicheng District of China, first opened its doors in 1992. To date, this is the second plant that it has shut down in China; prior to this, the Korean giant had shuttered the doors of its factory in Tianjin last year.
Samsung’s decision to move its production facility outside of China is most likely due to the new US tariffs; As of this month, the Trump administration put into effect new tariffs on electronic goods shipped into the US by at least 19%. Specifically, the tariffs are aimed primarily at electronic goods that are manufactured in China.
Many US brands and companies have protested against the tariffs, stating that it would not only hurt their profit margins, but also “tilt the playing field” more in their rival’s favour. Unsurprisingly, Samsung isn’t the only one that’s pulling out; Apple is mulling over whether it should pull out 30% of its production out of the country and re-establish a base in another country.