Heading to the Lone Star State for Favorable Conditions: Wistron Eyeing US-Mexico-Canada Agreement Benefits for Notebook Production
- Contributor: Meryl Kao / Staff Reporter
Wistron to Manufacture High-Performance Computing Devices in Dallas by Next Year
Tech manufacturer Wistron Corp, known for its server and laptop production, revealed plans to expand its Texas plant's capabilities, producing high-performance computing (HPC) devices for clients by the end of 2023.
This move aims to circumvent the implications of US tariffs, as the company has secured its first order for the new plant in Dallas and holds discussions with potential customers. Wistron president, Jeff Lin, stated that the expansion isn't a hasty decision but a continuation of their long-term strategy.
The Dallas production line will focus predominantly on HPC products and incorporate high levels of automation, with a maintenance service facility planned at the site. Lin, however, dashed hopes of Middle Eastern factories, stating that Wistron would instead assist clients in shipping products to the region.
When queried about AI server demand, Wistron's chairman, Simon Lin, remained optimistic about growth despite geopolitical tensions, citing increased corporate adoption. Regarding the influence of US tariff policies on AI server orders, Jeff Lin maintained that demand remains high due to the surging demand for AI applications despite tariff-related challenges.
Although enthusiastic about AI server prospects, the company remains cautious about the potential impact of US tariffs on laptop computing. Retail laptop prices could potentially surge by 10% to 20% in severe scenarios.
Intriguingly, Wistron is contemplating relocating some laptop manufacturing to Mexico to take advantage of the favorable tariff terms offered under the US-Mexico-Canada Agreement (USMCA). While a conclusive decision hasn't been made, factors such as higher production costs in Mexico may impede this shift.
Despite the current uncertainty, Wistron anticipates shipping more laptops this year compared to last, owing to replacement demand due to the conclusion of Microsoft's Windows 10 operating system and the post-COVID-19 upgrade cycle. Notably, in the first quarter, Wistron shipped 4.9 million laptops, representing a 7.55% decline from the preceding quarter but a 6.52% increase year-on-year.
It's pertinent to mention that the USMCA offers tariff exemptions for imports of goods from Mexico and Canada that meet the agreement's conditions, though specific tariff conditions for laptop production under USMCA aren't explicitly elucidated [4][5]. To benefit from these preferential tariff conditions, products must conform to the rules of origin set by the agreement, although specific tariff conditions for laptops under USMCA are currently undefined. Additionally, it's worth noting that the US has levied tariffs on certain goods, but these may not be associated with the USMCA [2][3]. For precise details on the tariff conditions for laptop production under USMCA, it is necessary to consult specific trade documentation or legal resources focused on the agreement.
- Wistron is considering relocating some laptop manufacturing to Mexico to capitalize on the tariff exemptions offered under the US-Mexico-Canada Agreement (USMCA), as part of its broader business strategy in technology and finance.
- The advantageous conditions of the USMCA, particularly the tariff exemptions for specific goods meeting the agreement's terms, could potentially influence Wistron's technology-focused business decisions and finance plans, such as laptop production in Mexico.
