Silicon Valley tech minds plot to move huge production out of China
The developing story of US-China trade conflict has built a lot of curiosity in the global audience. But as its said curiosity kills the cat!
It was seen that the moment market started getting touchy to the hugs US President Donald Trump offered to its counterparty China President Xi Jinping at G20, the news started floating on the plans of the US Tech giants to withdraw their huge chunk of production from China.
On Wednesday, Nikkei reported that consumer electronics makers Google, Amazon, Microsoft, HP and Dell are plotting to move their significant portion of product manufacturing out of China. The main areas of concern are stated to involve gaming consoles and smart speakers for Google, Amazon and Microsoft while the world’s leading personal computer makers Dell and HP are looking to shift their notebooks production.
The street talks about the world’s consumer tech factory has spurred the new round of discussion among the global audience. To record, the negative market sentiments could be seen taking a stance on Chinese benchmark indices. Shanghai Composite Index is down 0.33% to CNY3,005.25 on 4 July 2019 (5:11 PM AEST).
The media reports claimed that approximately 30% of the notebook production could be drawn out by Dell and HP. As per the data presented by Nikkei, these two personal computer makers shipped approximately 70 million notebooks combinedly across the globe with the majority of units being produced in China.
It seems that the production withdrawal plan of Silicon Valley giants could make the deep dent in China’s image of being the world’s largest producer of smartphones and personal computers. Sino’s electronic exports and imports have been the biggest contributor to the nation’s good looking economic picture, but now it has been an area of major concern.
Even the last month, the iPhone maker pointed out its plan to reduce its reliance on China’s land for production and look for other Southeast Asia nations. The media reports stated that Apple Inc. is exploring costs and benefits associated with shifting its ~15%-30% smartphone production away from China as a part of its supply chain restructuring program.
CEO Tim Cook led Apple has asked its suppliers including iPhone assembler Foxconn to evaluate the cost implications and their capacity if the company demands them to adjust the production line outside China, reported Nikkei.
Countries like India, Mexico, Vietnam, Indonesia and Malaysia are stated to be on Apple’s list of favourites for the establishment of its production units. The reports, however, added that it would take nothing less than 18 months to begin production after finalising the location.
All this buzz of tech dominants moving out from China has been stemming from the uncertainty prevailing around the US-China trade war. The recent trade truce agreed between the United States President Donald Trump and Chinese President Xi Jinping at the G20 Osaka summit in Japan was not enough to turn down the stigma around the skirmish where technology remains at the epicentre of the battleground.
Other renowned computer makers like Acer, Lenovo and Asustek Computer are also considering plans to join the electronic exodus from China, stated Nikkei. The move also outlines the rising manufacturing costs in China underpinned by the accelerating wage growth in the nation.
China has lost the tag of ‘low-cost manufacturing markets in Asia’ long back and now it seems to struggle through cost control over wage growth. It was recorded that China’s high-volume consumer electronics manufacturing sector has undergone a massive wage growth in the past decade. In light of this situation, many corporate dignitaries have been vocal on media platforms suggesting China to focus on innovation and workers’ skills to narrow down its wage gap with the low-cost market.
However, it’s important to note that no official information has been released by any of these tech players asserting their exit from China.
Facebook, Instagram and WhatsApp faced a severe breakdown for over 10 hours globally!
Globally famous social media platforms Facebook, Instagram and WhatsApp experienced one of their biggest technical failures on Wednesday 3 July 2019, which continued for nearly 10 hours across the world.
The now resolved technical glitch in these users’ favourite social media platform caused errors in downloading, uploading and sending across images and other media files on Facebook-owned social media apps. The outage affected the global audience, including the people of the United States, Asia, Europe, South America and Australia.
This global breakdown created a strong outrage among thousands of users who took the matter to Twitter. Some shared their experience to check with others while some reported the serious problem due to the network issue. And even the meme world came into the action to joke about the outage and users dependence on these apps.
However, Facebook acknowledged the issue tweeting about its awareness of the issue and the team working to get things back to normal at the earliest.
It took around 10 hours for Facebook to fix the issue! Late on Thursday morning AEST, Facebook reported that the technical glitch has been fixed. The social media giant stood tall, with all its apps- WhatsApp, Facebook and Instagram- back in business 100%.
Why did the issue occur?
Facebook stated that the global glitch occurred during one of its routine maintenance operations, as per the media reports. However, no details, citing the reason for the issue, were officially released.
It was recorded that the United States’ people were affected the most from the outage. On the front of Australia, Sydney and Brisbane were seen as the two most affected cities. This added to a series of historical outages that the company has faced in its past.
Interestingly, the equity investors remain unaffected by the issue as NASDAQ: FB stock price formed an upside of 1.13% in a day trade to close at USD197.20 on 3 July 2019 post the outage.
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