Google won't make Pixel devices in China after 2027
What's the story
Google is planning to move its entire Pixel production out of China by 2027, a Nikkei Asia report has revealed. The shift will include not just smartphones but also smartwatches and wireless earbuds. This strategy is part of Google's broader plan to diversify its supply chains amid US-China tensions and rising component costs.
Production shift
India and Vietnam will be Google's main production hubs
The report indicates that India and Vietnam will be Google's main production hubs for Pixel devices.
The company has already started expanding its manufacturing capacity in these countries.
This year, it began developing and producing high-end Pixel phones in Vietnam, a more complicated process than making smartwatches or earbuds.
The success of this transition has given Google the confidence to move all Pixel production out of China.
Cost management
Google to raise Pixel shipments by 8-10% this year
Despite the rising costs of memory chips, Google is looking to raise its Pixel shipments by 8-10% this year from around 12 million units last year.
The company is said to be improving its bargaining position in memory chip negotiations by bundling orders for its cloud-computing business with smartphone orders, with Micron, Samsung, and SK Hynix.
Industry shift
Wider trend among tech companies
Google's decision to move Pixel production out of China is in line with a wider trend among tech companies.
The move comes amid strained US-China relations and the ongoing efforts by technology firms to diversify their manufacturing across multiple countries.
This strategy could help mitigate risks from trade restrictions, geopolitical tensions, or changes in local manufacturing conditions.