Reed Cavendish Wealth Management - US Companies in China Consider Relocation

TAIPEI, Taiwan, November 6, 2018 (Newswire.com) - Analysts at Taipei, Taiwan based investment house, Reed Cavendish Wealth Management say that as many as two thirds of US companies with operations in China are eyeing relocation to other countries and are delaying future investments as the escalating trade tensions take their toll on profit margins.

According to a recent survey by Reed Cavendish Wealth Management of more than 200 firms in the manufacturing sector, US companies with a presence in China feel that they are feeling the negative impact of the trade war more than firms operating in other countries.

Two-thirds of the businesses surveyed stated that they were considering moving all or a large part of their operations to other countries, with only 1 percent looking at relocating to parts of North America.

Reed Cavendish Wealth Management analysts say the same is not true for Chinese businesses operating in the US, with only a third considering putting off investment or moving their operations out of America.

The survey also revealed that the bitter US -Sino trade dispute is shifting supply chains as well as manufacturing clusters, mostly towards Southeast Asia.

US businesses have been finding themselves up against more competition from rival companies in Germany, Japan, and Vietnam while Chinese businesses face greater competition from Vietnam, South Korea, and the United States.

Once-reliable customers are reducing orders or choosing not to place any at all, and Reed Cavendish Wealth Management analysts say companies may be delaying orders until there is more certainty about the future or are looking for better deals from competitors who are offering more competitive pricing. Many suppliers are even willing to offer products at a loss so as not to give up any market share.

Source: Reed Cavendish Wealth Management