Facebook parent company Meta is struggling to move its hardware manufacturing and supply chain out of China and shake the “Made in China” labels from its products as geopolitical tensions between the Asian superpower and the U.S. continue to rise — reports The Washington Post.
China’s position as a global manufacturing hub has taken a bit of a hit as of late due to growing tariffs, former U.S. President Donald Trump’s trade war against the country, and recent COVID-related manufacturing disruptions.
As a result, hardware giants like Apple are accelerating plans to move more of their production out of China. The iPhone maker has already jumpstarted production in nearby countries like India and Vietnam. Meta, however, has hit walls trying to do the same, said three people familiar with the internal discussions.
Until recently, the people said, Meta executives viewed the company’s reliance on China to make Oculus virtual reality headsets as a relatively minor concern because the company’s core focus was its social media and messaging apps.
All that has changed now that Meta has rebranded itself as a hardware company, the people said. Beyond last year’s name change from Facebook to Meta, the company has undertaken a broad internal reorganization, launched augmented-reality smart glasses, and is building a connected device that could be worn on a person’s wrist. In October, the company introduced Meta Quest Pro, the first in a new line of headsets built for collaboration.
Meta tried to pivot components and manufacturing for its smartwatch, which was ultimately scrapped last year, out of China to qualify for a “Made in Taiwan” label from U.S. customs authorities. Doing so would have allowed the company to save on tariffs imposed by the U.S. and made for a better look politically, but it was unsuccessful.
“Meta is building a complicated hardware product. You can’t just turn on a dime and make it elsewhere,” said one Meta executive.
The company confirmed that it is considering options to move its hardware manufacturing out of China. “At present, Meta’s consumer electronics hardware is manufactured in China but we are constantly reviewing and exploring supply chain opportunities around the world,” said a spokesperson for Meta.
While Meta’s smartwatch ambitions didn’t survive a recent round of belt-tightening that cut thousands of jobs and scrapped several projects, the company is still developing a wearable device meant to go on users’ wrists, according to two sources with knowledge of the plans.
You can check out the full report over at The Washington Post.
