In response to changes in the trade war, Taiwan’s textile industry looks for the next Vietnam
The U.S.-China trade war has impacted many industrial supply chains, and many companies have moved production lines from China to Vietnam. Taiwanese textile companies that had already set up factories in Vietnam seized the opportunity, but they also felt the squeeze-out effect. They have set their sights on the next Vietnam and actively opened up new blue oceans.
China is a major textile manufacturing center. The United States is currently imposing additional tariffs on US$250 billion of Chinese goods. Clothing is generally excluded, temporarily escaping the impact of increased tariffs. However, with the prospects of the trade war unclear, many garment factories are considering relocating to Southeast Asian countries such as Vietnam, Indonesia, and Thailand, which will affect the textile industry supply chain.
Taiwan is an important source of supply for functional textiles, which are used by sports brands such as Nike and adidas. During the TexworldUSA Summer Exhibition and the Functional Textiles Exhibition in New York last week, exhibitors from Taiwan discussed the impact of the U.S.-China trade war.
You Rongli, general manager of fiber yarn manufacturer Donglong Xingye, said in an interview that China is an important production base for garments, and garment manufacturers are wavering on whether to move factories. Brand owners Due to hesitation, orders are often placed at the last moment, which affects Taiwan’s fabric exports. This situation has lasted for more than half a year.
Because Vietnam enjoys preferential tariffs for textile exports, it has become a new production base for many Taiwanese companies in the past few years. Since the start of the U.S.-China trade war more than a year ago, Vietnam’s role in undertaking orders has become more important, becoming one of the countries benefiting from changes in many industrial supply chains.
Huang Weiji, secretary-general of the Textile Industry Association, believes that Vietnam’s orders may increase next year, but in the long run “it won’t be able to increase”.
Huang Weiji said that Vietnam has a population of about 100 million, which is smaller than Guangdong Province. With the influx of electronics, machinery, plastics and other industries, Vietnam’s demographic dividend has gradually shrunk. It is impossible to fully undertake the orders lost from China, and investors who originally set up factories in Vietnam may also feel the crowding out effect of more difficulties in purchasing land and recruiting workers.
The garment factory New Wing Group was concerned about the rising production costs in China five years ago and planned to set up a factory in Vietnam. It started mass production two years ago. As the demand for ready-made garments in Vietnam increases day by day, Wu Renxiao, deputy general manager of New World International Marketing Department, is glad that he made early arrangements and his current performance is “not only good, but great.”
But he changed the topic and pointed out that production in Vietnam has encountered bottlenecks and the problem of labor shortage is getting more and more serious. It feels not as good as imagined. Let’s see where is the next step now? Vietnam.
Runtai Group’s garment business has reduced the proportion of production in Taiwan in recent years and regards Vietnam as an important production base. It has also felt that the US-China trade war has prompted the supply chain to move to Vietnam. effect.
Wu Xueqin, associate manager of Runtai’s business department, said that manufacturers expect that Chinese goods will be levied with more tariffs in the future, so they are rushing to Vietnam. Runtai has already exported to Cambodia, Myanmar , Ethiopia and other African countries are listed as candidate locations for setting up factories. As for Taiwan, although the bayberry factory shut down its lights in April due to high production costs, it does not rule out investment in Taiwan if the automated garment production technology matures in the future.
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