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Foxconn reportedly considers new Mexico factory over China trade war concerns

A series of major Asian manufacturers such as Foxconn, Pegatron, and Luxshare are considering opening new factories in Mexico. It’s reportedly a response to the coronavirus pandemic and ongoing US-China trade war.

A number of major Asian manufacturers such as Foxconn, Pegatron, and Luxshare are considering opening new factories in Mexico, Reuters reports, responding to the coronavirus pandemic and ongoing US-China trade war. Foxconn reportedly has plans to produce iPhones at the new factory, according to two Reuters sources, although Apple isn’t thought to be directly involved at this time.

The plans are thought to have come in response to looming tariff barriers between the US and China. Reuters notes that locating factories in Mexico could allow companies to benefit from the new United States-Mexico-Canada trade agreement, allowing them to take advantage of tariff-free exports to the US under certain circumstances. The idea of encouraging firms to move manufacturing from Asia to the Americas is reportedly gaining political traction in Washington, too.

A final decision is expected to be made later this year

There’s precedent for this kind of relocation, with Foxconn previously investing in countries in response to tariffs. In July, Reuters reported that Foxconn had plans to invest as much as $1 billion in India. Later that month, TechCrunch reported that it had started assembling flagship iPhones in India for the first time, avoiding a 20 percent import duty the country imposes on foreign-madeā€¦

Jon Porter

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