Microsoft is reportedly moving its Surface (and Xbox) manufacturing out of China

Topher

Topher

Identifies as young
The move could also see server production move out of China, as trade tensions with the US intensify.

As trade tensions grow between the US and China, Microsoft is reportedly preparing to move the manufacturing of its Surface laptops and tablets out of China. Nikkei reports that Microsoft is aiming to move manufacturing of Surface devices and data center servers out of China "starting from 2026 at the earliest."

The move will reportedly include components, parts, and product assembly for future Surface hardware and server products. The report claims Microsoft has already shifted some of its existing server production outside China, and is pushing to also produce more Xbox consoles outside of the country.

News of Microsoft's potential manufacturing changes comes just days after President Trump threatened China with an additional 100 percent tariff and more export controls on software. The US and China have also started charging new port fees on each other's ships in recent days, just a week after Beijing tightened export rules on rare earths.

Microsoft is far from the only company trying to expand its manufacturing outside of China. Apple is also reportedly preparing to manufacture a series of new devices in Vietnam. Bloomberg reports that Apple's rumored smart home display hub, indoor security cameras, and a "more advanced tabletop robot" are set to be manufactured in Vietnam, in an effort to shift manufacturing away from China.

www.theverge.com

Microsoft is reportedly moving its Surface manufacturing out of China

Server production is also reportedly moving
www.theverge.com www.theverge.com

a9b5nf.jpg
 
Politics! Yea Baby!

Hope they have a video of that last Series S rolling off the assembly line. Just kind of rolls to the end of the conveyor and plops over into a trash can.
 
adamsapple said:
The goal: Bring manufacturing back to the US
The reality: Nah we're just gonna move it one country south.
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Exactly. I've been having this argument with my pro-tariff family/friends circle for months now. No matter how much they want to scream "Make it in America!", it won't magically will the supply chains and chip fabrication plants into existence. It would take years to get enough chip fabs and an integrated supply chain going because we long sold that out to become a predominately service economy a loooooooooooooooong time ago.

And even then we'd still be beholden to foreign supply chains for rare earth minerals which, IIRC, China still controls the vast majority of. So manufacturing might "move out" of China, but it ain't going far.
 
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I mean, if you're doing it in an attempt to save money and potentially avoid tariffs, I don't think Vietnam is a great call, lol. With the way things have been, it could change at any moment.
 
Nydius said:
Exactly. I've been having this argument with my pro-tariff family/friends circle for months now. No matter how much they want to scream "Make it in America!", it won't magically will the supply chains and chip fabrication plants into existence. It would take years to get enough chip fabs and an integrated supply chain going because we long sold that out to become a predominately service economy a loooooooooooooooong time ago.

And even then we'd still be beholden to foreign supply chains for rare earth minerals which, IIRC, China still controls the vast majority of. So manufacturing might "move out" of China, but it ain't going far.
Click to expand...

Some stuff is coming to the US. Some big investments as well. Some will go to lower tariff countries. It's all win/win as long as we are less reliant on China.
 
Trekinspace88 said:
Even if they move production to the US it will just mean higher prices for everything as you will have to pay the workers real salaries.
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It will also take year(s) to establish appropriate factories, not to mention they still would need all those international partners for all the component shipments.

It would be damn near impossible to manufacture these things entirely within the US.
 
Nydius said:
Exactly. I've been having this argument with my pro-tariff family/friends circle for months now. No matter how much they want to scream "Make it in America!", it won't magically will the supply chains and chip fabrication plants into existence. It would take years to get enough chip fabs and an integrated supply chain going because we long sold that out to become a predominately service economy a loooooooooooooooong time ago.

And even then we'd still be beholden to foreign supply chains for rare earth minerals which, IIRC, China still controls the vast majority of. So manufacturing might "move out" of China, but it ain't going far.
Click to expand...
TSMC is already up in running in Arizona, though dies are being shipped to Taiwan for packaging. TSMC is also close to closing deals for more land to expand https://www.msn.com/en-us/technolog...and-to-grow-semiconductor-gigafab/ar-AA1OBmb3

NVIDIA is planning to have their full server manufacturing able to create servers fully within the US.

Changes to allow rare earth mining are underway. China started pushed back against the US and other countries which is what pushed off the latest tariff talk.
 
adamsapple said:
It will also take year(s) to establish appropriate factories, not to mention they still would need all those international partners for all the component shipments.

It would be damn near impossible to manufacture these things entirely within the US.
Click to expand...
Gotta start the decoupling process at some point.
 
A family of products I use at work changed from China to India and it brought our industry to its knees. I still don't see how we recover from it. What the world sees in their manufacturing "prowess", I will never understand. It's uniformly the worst country at producing complex good that I know of. If you ever meet an engineer who has spent time there to train the workers, make sure you get some stories out of him. They're absolutely riveting.
 
Zacfoldor said:
...but they can assert lateral pressure....
Click to expand...
So long as you are happy paying for the pressure... Besides this move isn't about reducing cost, its about avoiding having to increase pricing again.

Imagine trying to forward plan in this environment. The only safe harbour is manufacture in the US, except you know that labour will be a nightmare, all the expertise has over decades been exported to Asia and you can't even offer them a visa and a job to re-import the knowledge. As to the cheap labour, well thats not possible either because you are busy deporting it all. So you are left with citizens and there are serious doubts about whether enough want to work in a sweatshop.

Not to mention the implicit assumption that the US retains the capability to manufacture at scale deploying current best practice. Lets just say there are some serious structural deficits in the education area that would bottleneck shifting manufacturing back to the States. Would take decades to do. Thats just on labour, you also have an energy environment where the States are now literally biased against the cheapest form of energy and you have AI competing for what energy can be squeezed out of an aging grid. None of it is insurmountable, but the policy settings are often the literal opposite of whats needed. It can't just be tariffs.
 
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Nydius said:
Exactly. I've been having this argument with my pro-tariff family/friends circle for months now. No matter how much they want to scream "Make it in America!", it won't magically will the supply chains and chip fabrication plants into existence. It would take years to get enough chip fabs and an integrated supply chain going because we long sold that out to become a predominately service economy a loooooooooooooooong time ago.

And even then we'd still be beholden to foreign supply chains for rare earth minerals which, IIRC, China still controls the vast majority of. So manufacturing might "move out" of China, but it ain't going far.
Click to expand...
Exactly. Build the factories/infrastructure first is the only logical first step. The way orange man is doing it is ass-backwards, which to be fair is completely expected from someone who stated today "200%" and "400%" drug price decreases.
 
So is the orange idiot going to tariff Vietnam or wherever production moves to at the China rate?

For the reasons pointed out above, the environment really does not exist for these companies to move production en masse to the US. Especially at a time where US immigration policy is tighter than at any point in recent memory.
 
Topher said:
The move could also see server production move out of China, as trade tensions with the US intensify.

As trade tensions grow between the US and China, Microsoft is reportedly preparing to move the manufacturing of its Surface laptops and tablets out of China. Nikkei reports that Microsoft is aiming to move manufacturing of Surface devices and data center servers out of China "starting from 2026 at the earliest."

The move will reportedly include components, parts, and product assembly for future Surface hardware and server products. The report claims Microsoft has already shifted some of its existing server production outside China, and is pushing to also produce more Xbox consoles outside of the country.

News of Microsoft's potential manufacturing changes comes just days after President Trump threatened China with an additional 100 percent tariff and more export controls on software. The US and China have also started charging new port fees on each other's ships in recent days, just a week after Beijing tightened export rules on rare earths.

Microsoft is far from the only company trying to expand its manufacturing outside of China. Apple is also reportedly preparing to manufacture a series of new devices in Vietnam. Bloomberg reports that Apple's rumored smart home display hub, indoor security cameras, and a "more advanced tabletop robot" are set to be manufactured in Vietnam, in an effort to shift manufacturing away from China.

www.theverge.com

Microsoft is reportedly moving its Surface manufacturing out of China

Server production is also reportedly moving
www.theverge.com www.theverge.com

a9b5nf.jpg
Click to expand...
That meme killed me lmao
 
OLED_Gamer said:
Exactly. Build the factories/infrastructure first is the only logical first step. The way orange man is doing it is ass-backwards, which to be fair is completely expected from someone who stated today "200%" and "400%" drug price decreases.
Click to expand...
How do you incentivize the factories and infrastructure though? Unless there's something hard hitting there will be promises without anything being done like Foxconn in Minnesota and many other examples.

As for drug prices, Pfizer works out a deal that new drugs will be created in the US and the US will have favored nation pricing where it will have the lowest price anywhere in the world. Will that raise prices in Europe? Maybe, but the US won't be getting charged 10x or more even after Federally financing a lot of the research.

It's almost like threaten very bad terms and give a deadline to get the other party to the table and you backtrack to let them think they are getting a good deal is a strategy that works and was written about but people are surprised every time.

Always Sunny GIF by hero0fwar


TheChumpNation said:
So is the orange idiot going to tariff Vietnam or wherever production moves to at the China rate?

For the reasons pointed out above, the environment really does not exist for these companies to move production en masse to the US. Especially at a time where US immigration policy is tighter than at any point in recent memory.
Click to expand...
It's currently 20% with a 40% for transhipping (import to Vietnam -> "made in vietnam" -> export to US). There was originally a 46% discussed that so far has been talked down. 30% of Vietnam's GDP is US trade, they are much more open to the US in terms of trade talks.
 
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TheChumpNation said:
So is the orange idiot going to tariff Vietnam or wherever production moves to at the China rate?

For the reasons pointed out above, the environment really does not exist for these companies to move production en masse to the US. Especially at a time where US immigration policy is tighter than at any point in recent memory.
Click to expand...
Reason for the latest tariff round with China is the latter just completely locking down rare earth based exports including items manufactured even with 0.2 (or was it 0.02%) materials content either processed or mined in China.
 
Nydius said:
Exactly. I've been having this argument with my pro-tariff family/friends circle for months now. No matter how much they want to scream "Make it in America!", it won't magically will the supply chains and chip fabrication plants into existence. It would take years to get enough chip fabs and an integrated supply chain going because we long sold that out to become a predominately service economy a loooooooooooooooong time ago.

And even then we'd still be beholden to foreign supply chains for rare earth minerals which, IIRC, China still controls the vast majority of. So manufacturing might "move out" of China, but it ain't going far.
Click to expand...
I think the logic is that since China is actually strong enough to push back and compete If the US tries to strong arm it, by moving the supply chain and production out of China into smaller weaker countries the US can just bully and coerce said countries into getting what it wants. I know it sounds bad but that's the reality it's how it operates, it gets what it wants or there is a need for regime change or freedom.
 
I'm all for it, decrease the dependency on china. This country practically made China what it is and it's GDP. As an adult this country has needed a financial reset for a long time as it has been getting abused. And Microsoft is a terribly running gaming company but based in the US and I support those initiatives.
 
Not ideal, but if they're gonna still exploit cheaper labor, I'd rather see it spread across other countries that the reliance on China.
 
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