Kyocera switches production to avoid tariffs

August 5, 2019

The looming fourth round of tariffs has led Kyocera to move production from China to Vietnam so the copier production which mostly goes into the US is not impacted by the new round of tariffs.

Nikkei Asian Review reported that Kyocera is one of the latest OEMs to announce that they are moving production as to avoid tariffs set by President Trump. On 1 August, President Trump tweeted that the fourth round of tariffs are coming into effect from 1 September.

This will mean a further 10 percent on $300 billion (€269 billion) worth of Chinese imported products will be included in the tariff list, including printer cartridges. Previously MFPs and copiers were included but the latest list also includes cartridges.

The National Law Review explained that it still remains to be seen if there are changes to be made after the “public comment process” which will conclude this summer.

This latest announcement by Trump has no also triggered reactions from Kyocera. Ricoh was one of the first ones earlier this year to announce the move of production out of China due to tariff threats. Kodak and Fujifilm already moved for exclusion on the tariffs earlier this year as well as Ninestar stating in 2018 its products were exempt.

Kyocera President Hideo Tanimot said: “We will switch production between Chinese facilities and Vietnamese facilities.” This comes as a move that machines built in Vietnam are currently destined for the European market and devices built in China are currently destined for the US. This switch means the US tariffs imposed could, therefore, be avoided. This will happen during the fiscal year 2020 which ends 31 March 2020.

According to the Nikkei Asian Review article, this move will cost Kyocera about ¥1 billion ($9.2 million/ €8.2 million).

Tanimot warned: “The effect of China’s economic slowdown will be bigger than that from the additional tariffs. If the fourth round of sanctions against China are implemented, the Chinese economy will be impacted.”

Categories : World Focus

Tags : China Economy Tariffs Trade War USA