Google reportedly plans to shift some hardware manufacturing away from China in a move that would allow it to expand its operations and minimise the impact of tariffs.
Devices, such as the Google Pixel smartphone and Google Home voice-activated assistant, are currently made in the country.
However the US and China are engaged in a trade dispute that has seen President Donald Trump impose tariffs on Chinese-made goods.
According to Japanese publication Nikkei, Google has commenced the conversion of a former Nokia facility in northern Vietnam – the same region used by Samsung to develop a supply chain over the past decade. This will allow it to draw upon a pool of skilled workers to produce phones.
Nikkei says Google has plans to increase smartphone shipments to up to ten million by the end of the year – nearly double the figure last year. The new facility would give the company greater capacity to achieve that goal.
Google would not be the first major US tech firm to move production away from China. While tariffs have been a catalyst for the shift, there have also been concerns about rising labour costs.
Apple is reportedly looking to shift between 15 and 30 percent of its production to other countries, with India, Indonesia, Malaysia and Mexico among the candidates. However it would take several years to move even a portion of production away from China given the complex ecosystem that has been established there.
Google’s relatively smaller operation means it could move more production more rapidly.