Google plans to transition all manufacturing of its Pixel devices out of China by 2027. Historically, the company has produced its Pixel phones, watches, and earbuds in China. However, it has informed suppliers that production will shift to Vietnam and India beginning next year, as reported by a recent article.
The report identifies that Google is in a more advantageous position than Apple for this shift, mainly because Pixel devices are not directly sold in the Chinese market, which also has a relatively small number of smartphone users.
Previously, Google had indicated intentions to exclusively develop and manufacture Pixel 11 devices in Vietnam, which requires investment in various types of equipment. The success of this initiative seems to have encouraged the company to extend manufacturing of other Pixel devices to Vietnam as well.
In addition, Google has apparently informed suppliers of plans to boost shipments of Pixel phones by 8% to 10% this year, following the shipment of 12 million Pixel phones last year. This increase is part of a broader effort to promote the use of its Gemini artificial intelligence tools.
If Google follows through on this manufacturing change, it will be in line with Samsung, which also moved its smartphone production from China, concluding this process in 2019 with most manufacturing relocating to Vietnam and India.
As for the tech landscape, the ongoing memory chip shortage, spurred by the AI expansion in data centers and cloud services, is impacting many companies across the sector. To tackle this, Google has reportedly been combining orders for phone memory chips with those needed for its AI and cloud services.
Overall, this shift provides an opportunity for Google to strengthen its negotiating position with memory chip suppliers, possibly resulting in better terms for its purchases across various product lines.
FOX Business reached out to Google for further comments.
