As early as Obama's time, the United States believed that the world's manufacturing industry was too dependent on China, so it moved its manufacturing industries in China to countries such as India and Vietnam, with the intention of allowing Southeast Asian manufacturing to replace China's manufacturing.
However, the General Administration of Customs of Vietnam recently announced that in August, Vietnam's imports of textiles, clothing and footwear (various types of cotton, cloth, yarn and textile, clothing and footwear raw materials) totaled US$1.89 billion.
In the first eight months, imports of this product reached 17.7 billion U.S. dollars, an increase of 29.4% year-on-year, equivalent to a net increase of 4 billion U.S. dollars. The origin of this product is mainly from China, with imports from China amounting to US$9.2 billion, a year-on-year increase of 35%, accounting for as much as 52%.
It shows that Vietnam's manufacturing industry is still inseparable from China to a large extent. With the worsening of the epidemic in Vietnam, the suspension time of Vietnamese factories has been further extended, and many European and American companies are overwhelmed.
American businessmen once said that they spent 6 years building a supply chain in Vietnam, but within 6 days, this supply chain was abandoned.
Vietnam used to be highly sought after by European and American companies because of its cheap labor and low-cost production materials. European and American companies have built factories in Vietnam one after another. However, under the impact of the epidemic, Vietnam has lost its advantages, and its advantages in attracting foreign investment have also turned into disadvantages.
The US media said that the current situation has undergone a major reversal, and the manufacturing industry has returned to China from Vietnam. There are several reasons that caused the European and American factories to move back to China.
A large number of European and American brand factories have
plummeted production due to the epidemic
One of the most important reasons is that a large number of brands have been affected by the epidemic in Vietnam, and commodity production has plummeted.
Sports brand giant Adidas said that due to Vietnam's anti-epidemic policy, the company's long-term shutdown and production shutdown caused the company's sales this year to drop by $600 million. In the sluggish market, Adidas was hit hard.
Lakeland Industries, a US manufacturer of protective clothing, also said that it will move its factories in Vietnam back to China. To this end, the company has also hired new executives to be responsible for the transfer of the factory. Lakeland plans to complete the transfer of the factory within a few weeks.
The status of the sports brand giant's Nike is not optimistic. Last year, Nike produced about 350 million pairs of sports shoes in Vietnam, but its output has shrunk significantly this year. Some people estimate that Nike's output this year may be reduced by 150 million pairs
Japanese clothing brand Uniqlo is also deeply affected by the epidemic in Vietnam. Uniqlo announced that it will postpone the launch of some new products due to the delay in the production and logistics of the brand’s factories in Vietnam. Vietnam is its main production country, and other large clothing companies in Japan are also The sales plan was adjusted for the same reason.
The transportation industry is hit hard
At the same time, Vietnam also has big problems in terms of transportation capacity.
Ho Chi Minh City can only handle 6.15 million containers each year, while Shanghai handles as many as 40 million containers each year. Even if the product can be produced but cannot be shipped out, it doesn't make much sense.
Vietnam's transportation industry has been hit hard by the epidemic. The shortage of freight containers and the shortage of truck drivers have plagued Vietnam's transportation industry.
Under this circumstance, the freight rate has increased substantially, the transportation time has been extended, and the factory has to pay for the isolation expenses of the employees, and the production cost has further increased.
European and American holidays are coming
A very important reason for these European and American factories to move back to China is that the New Year’s and Christmas holidays are coming, during which consumers will have a large amount of shopping demand, and these factories need to increase their output to hoard goods.
However, most areas in Vietnam are still under the epidemic lockdown, unable to meet the production needs of these factories.
China, where the epidemic is well controlled and has a vast market, has become the first choice for these companies. They said that returning to China is definitely the worst option.
Multinational companies choose to produce in China, essentially because China has a good production and operation environment.
In order to resume production and production in Vietnam's manufacturing industry, China has repeatedly extended a helping hand to Vietnam. Previously, the Chinese military provided vaccine assistance to Vietnam at the request of the Vietnamese side. The Vietnamese side expressed its heartfelt gratitude for this. In the context of the huge vaccine gap in Vietnam, it has solved Vietnam’s urgent needs. The Vietnamese side believes that these vaccines are in containment of the current epidemic. Played an important role.
