Samsung Electronics to halt production at its last computer factory in China

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Sat Aug 1, 2020 / 3:52 AM EDT

SEOUL (Reuters) – Samsung Electronics Co will halt operations of its last computer factory in China, the South Korean tech giant said on Saturday, the latest manufacturer to shift production from the world’s second-biggest economy.

Companies are rethinking their production and supply chains amid rising Chinese labour costs, a U.S.-China trade war and the blow from the COVID-19 pandemic.

Around half the 1,700 employees on contract at Samsung Electronics Suzhou Computer will be affected, excluding those involved in research and development, the South China Morning Post reported on Friday, citing a notice to Samsung staff.

The factory shipped $4.3 billion worth of goods out of China in 2012, a figure that had sunk to $1 billion by 2018, the Hong Kong newspaper said.

A Samsung spokeswoman declined to comment on the factory’s revenue and shipments, or details regarding employees.

“China remains an important market for Samsung and we will continue to provide superior products and services for Chinese consumers,” the company said in a statement.

Samsung shut its last smartphone factory in China last year. Its remaining facilities include two semiconductor manufacturing sites in Suzhou and Xi’an.

(Reporting by Joyce Lee; Editing by William Mallard)

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