While these measures aim to incentivize domestic manufacturing, the practical outcomes tell a different story.
This is almost a commodity business.
We chatted for a bit.
They told us about their products, and we exchanged the latest insights on industry trends.
Finally, we asked about price.
Their response was, “Which factory do you want the product from?”
It turns out this company has two factories: one in China and the other in Thailand.
These plants use identical equipment and produce the same products.
The company’s entire catalog is available from either site.
“Why do you have two factories?”
Their response was that the plant in Thailand was built two years ago entirely for U.S. customers.
The tariff for products coming from Thailand is 0%.
So, after a few years, the company opened a plant in Thailand.
Finally, we asked about price again.
“Oh, the prices are the same.
Admittedly, Thai prices are not 20% higher than China prices, but close enough.
This trend is occurring across the supply chain.
CES was full of companies promoting their factories in Malaysia, the Philippines, Vietnam, and Malaysia again.
However, all the owners are Chinese companies.
