Trump updated Twitters and then Chinese stock market plummeted for a few days.
Then today the Ministry of Commerce issued a statement
A spokesperson for the Ministry of Commerce said that the US intends to raise the tariff imposed on 200 billion US dollars of Chinese exports to the United States from 10% to 25% on May 10. It is inconsistent with the interests of the two peoples and the people of the world to escalate trade frictions. The Chinese party expressed that if the US tariff measures are carried out, China will have to take necessary countermeasures.
Liu He, member of the Political Bureau of the CPC Central Committee, vice premier of the State Council, and Chinese leader of the China-US Comprehensive Economic Dialogue, will visit the United States from May 9 to 10 for the eleventh round of consultations with the US on economic and trade issues.
It is early to say how this trade friction ends up. Let’s wait for the official saying on Friday.
How do the vacuum tycoons react?
Bissell joins hands with VS Industry, a major OEM maker of Dyson, starting from a model previously made by Flextronics. Now VS no more makes vacuum cleaners for Dyson, while AirWrap and other products are still in production.
Shark has involved some partners in investigation. Temporarily, there is no model transfer.
iRobot starts to make some models in Vietnam. It focuses on prevention of problems emerging from the trade friction, as shown in its annual report in 2019. The friction that lasted for several months has already brought loss of millions of dollars to iRobot.
TTI is early in globalization. Its factories in Vietnam was early built, yet not big enough for this transfer.
Let’s see what Bissell, iRobot, and Shark say at the 301 hearing.
Moves of whole machine giants in Southeast Asia:
LEXY: An investment of tens of millions was planned for a factory in Vietnam as a way to go through this hard time. It was suspended later as the situation got eased. Multiple sources unveiled that LEXY has sold its site in Vietnam.
Ecovacs: It has no moves in this regard, likely because its OEM orders are getting less, leaving no room for Southeast Asia. However, North American market matters a lot to Ecovacs/Tineco self-owned brands. Maybe they will consider Southeast Asia for that reason.
EUP: It had no major actions last year. However, big client Bissell starts to work with VS. Without further moves, will VS profit at its expense?
Ningbo Dechang: Dechang, as the main OEM maker of TTI, responded the fastest last year and bought some plots.
Ningbo Furja: As the main supplier of Shark, Furja also bought a piece of land in Vietnam last year. I heard that there were changes later.
Guangdong Xinbao: Shimpo cooperated with the factory in Indonesia to deal with this trade friction.
Accessories factory:
Chunguang Technology: The largest hose factory in the vacuum cleaner industry. It worked with Dyson in Malaysia many years ago and thus became the largest hose supplier in the vacuum cleaner industry and got listed. As the early comer in Southeast Asia, Chunguang Technology will benefit the most from the trade friction.
Jingguang Plastics: Jinghua Plastics, another hose company of Jinhua, established a factory in Vietnam in early time, expected to benefit from it.
Samsung: It is expected to benefit from its lithium battery factory in Malaysia as lithium battery is vital to the cordless vacuum and matters a lot in the original factory identification.
Other parts manufacturers in the industry have also followed the whole machine factory/clients and had investigation. However, none of them starts production there given that no movement has been made by whole machine makers.
