Since the outbreak of the trade war between the United States and China, a number of foreign companies have been pulling their industrial chains out of China. The world’s largest hardware tools enterprise “Stanley Bade” also joined the ranks, announced the closure of the Shenzhen factory, estimated to involve thousands of employees. It is believed that Stanley Baird’s decision is based on commercial considerations, while some public opinion believes that the leading company’s choice to leave Shenzhen is related to the local policy.
Stanley Baird, whose corporate slogan is “Thinking Boldly and Innovating Daringly”, is known worldwide as a manufacturer of power drills, electric wrenches and other hardware tools, and is ranked among the Fortune 500 companies.
The factory was featured earlier in a Guangdong media report to celebrate the 40th anniversary of the founding of the Shenzhen Special Economic Zone. At the time, executives said that the company had significantly reduced the number of people needed on the production line by taking full advantage of advanced technologies such as collaborative robots. However, the world’s largest hardware tools company made a sudden announcement on Monday (26th), announcing the dissolution of its Shenzhen subsidiary and the shutdown of its Shenzhen factory from that day.
Uploaded on the Internet’s announcement that the overall market environment changes, coupled with the industry’s intensified competition, the group based on strategic development needs, accelerate the restructuring of business resources to enhance market competitiveness.
Since the outbreak of the U.S.-China trade war, many foreign companies have moved their industrial chain out of China and into Southeast Asia. Zeng Zhichao, deputy secretary general of Taiwan’s Chinese Economic and Financial Association, said that Stanley Baird’s products are mainly exported, and with China’s failure to effectively curb infringement, it is understandable that it chose to take this step in the face of difficult circumstances.
Zeng said: “The punitive tariffs have increased dramatically since the U.S.-China trade war, leading to a significant increase in costs and forcing these industries to move out of China in large numbers. (The technology) is being stolen in a big way. It was a very substantial (company), but there are more and more competitors in the mainland Chinese market. Some of its advantages have all been copied, which affects its development. If its volume (production) is not large enough, it is not good to produce in mainland China, and it is not good for its export. This kind of industry will be under great pressure and has the greatest possibility of leaving.
Mengjun Liu, director of the Institute of Mainland China Studies at the Chinese Academy of Economic Research in Taiwan, believes that Stanley Baird’s decision may be related to the importance the Shenzhen authorities have attached to high-tech development in recent years.
Mengjun Liu said: “Shenzhen is more inclined to innovation and encourages innovation. Perhaps the Shenzhen government feels that it needs to welcome enterprises with more innovation capabilities to stay. As for hardware, which is a traditional industry, it may not be welcomed by the policy.
According to the data, the “Stanley Baird” plant in Shenzhen covers 54,000 square meters and employs thousands of people. The compensation package offered by the employer is above the legal standard, according to comprehensive mainland media reports. It is unclear whether the production line will be moved to Southeast Asia or the United States.
It’s a world-renowned company, so it shouldn’t leave a mess,” said Liu Mengjun. It may handle the withdrawal procedure in accordance with Chinese regulations, there is no problem in this regard, but because Stanley Baird is a world-renowned brand, it may form a demonstration effect, sending a message that the local investment environment may become worse, there is a deteriorating trend, forming a cascading (lock) effect.
In 2010, there were several strikes over the relocation of Stanley Baird, the largest of which involved thousands of people.
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