Across the globe is a new challenge that is arising and is rapidly threatening the future of how hardware manufacturers will operate.
Taiwan is the world’s biggest and most sought-after destination to outsource hardware manufacturing to. Some of the world’s best chipset manufacturers for hire are located here and the chips manufactured here are used by almost all major electronics manufacturers to power their latest generations of products.
However, with tightening trade policies, US tech manufacturers may face increased difficulty in procuring these hi-tech chipsets. From what some of the CEOs of the biggest Taiwanese chipset manufacturers have to say, these trade policies will kick in sooner than later.
This news has sent shockwaves across the globe but has hit closer to home in the US than most. From Apple to Intel and almost all major US electronics manufacturers are highly reliant on Taiwan’s ability to manufacture high quality and hi-tech chipsets at a fraction of the price. Moreover, the Taiwanese expertise and infrastructure to manufacture these chipsets is a big reason why manufacturers are worried.
The only other solution that seems plausible is to plan to move manufacturing of chipsets outside Taiwan. Many organizations are already considering this, however, this move does not come without its share of challenges.
Tech companies will have to find a suitable destination to relocate this manufacturing to. But more importantly, the knowledge transfer needed to manufacture chipsets at par with Taiwan is what these companies have to contend with.
Without adequate training and transferring knowledge, manufacturing anywhere else will be a difficult nightmare to process. Moreover, these training and campaigns will not be short term processes because of the extensive need to obsess over the various parameters of chipset manufacturing which starts right at sourcing the materials needed, to setting up the right manufacturing processes, including machinery and robotics, to stringent quality checks, and timely order completion.
The need for localized training and vendor compliance will take frontstage here. And big tech companies that realize this sooner and the ones that move faster to address this growing challenge will stand to benefit the most.