Google and Samsung are elevating Vietnam's manufacturing status. Google is moving its Pixel product line production out of China, while Samsung is expanding its operations in Vietnam from smartphone manufacturing to semiconductor backend processing and research and development. Vietnam is transitioning from a simple assembly hub to a key player in the global tech supply chain.
According to recent reports from Nikkei Asia and other outlets, Google has informed suppliers of its plan to relocate all production lines for Pixel smartphones, smartwatches, and wireless earbuds outside of China starting next year. The company has been expanding its production base in Vietnam and India, successfully developing and producing high-end Pixel phones in Vietnam this year, which has bolstered its relocation efforts.
Google's Shift Supported by Vietnam's Supply Chain
The motivation behind Google's focus on Vietnam lies in the existing smartphone supply chain established there. One source noted, "Unlike Apple, Google does not face pressure to sell Pixel phones in the Chinese market, so it can leave China without that burden." The source added that the transition to Vietnam is proceeding smoothly, with Samsung already having built a smartphone supply chain ecosystem that Google can leverage.
Google is also actively working to increase Pixel phone shipments. Multiple sources indicate that Google plans to raise its Pixel phone shipments by 8-10% this year compared to approximately 12 million units last year. Despite soaring memory chip prices, Google views Pixel phones as a crucial channel for expanding its artificial intelligence (AI) service, Gemini.
In negotiations for memory chip purchases, Google is seeking favorable terms. One source reported that Google is bundling orders for cloud computing chips and smartphone business orders while negotiating with Micron, Samsung, and SK Hynix. The source stated, "This year's Pixel phone strategy is aggressive," adding that the Pixel line has been instructed to maintain production growth at all costs.
Google's pricing strategy for the Pixel line is also drawing market attention. The company recently unveiled the Pixel 11, Pixel 11 Pro, and Pixel 11 Pro Fold, with prices for the 256GB model starting at $899. This marks an increase from the previous model, the Pixel 10, which had a 128GB version priced at $799. Garret Schmidman, a senior analyst at Counterpoint Research, noted that Google is more cautious about raising prices on current models compared to brands like Samsung or Motorola that have significantly increased mid-range product prices.
Samsung Positions Vietnam as a Semiconductor and R&D Hub
Samsung's strategy in Vietnam is becoming increasingly detailed. The company is reportedly considering relocating some general DRAM and NAND flash packaging and testing from its factories in Cheonan and Onyang, South Korea, to Vietnam. This move is aimed at concentrating production capacity in South Korea on AI-related HBM memory.
While this plan is not yet finalized, if implemented, Vietnam would handle the packaging and testing of general DRAM and NAND products, while the facilities in Cheonan and Onyang would focus more on HBM and high-value processes. This adjustment is seen as a response to the growing demand for HBM due to increased AI investments while maintaining existing memory production.
Samsung's semiconductor foundation in Vietnam is already under construction. The company is building a $1.5 billion semiconductor testing facility in the Yen Binh Industrial Park in Thai Nguyen Province, which is expected to begin operations by November 2027. The facility will primarily operate traditional memory products, with an anticipated maximum annual production capacity of 15.33 trillion GB for DRAM and 25.56 trillion GB for NAND flash.
Samsung has also established relevant organizations. In the first quarter of this year, Samsung Vietnam Semiconductor was founded and included in the list of consolidated subsidiaries. Samsung's quarterly report classified this company as a subsidiary in the semiconductor manufacturing sector.
Vietnam's role has also been confirmed in the product development process. The Samsung Electronics factory in Thai Nguyen and the Hanoi R&D center participated in the development of the Galaxy Z Fold 8. The Galaxy Z Fold 8 is introduced as an ultra-thin and ultra-light product, measuring 4.5mm thick and weighing 201g, with an external screen ratio of 16:10 and an internal screen ratio of approximately 4:3.
Vietnamese engineers contributed to solving precision and durability issues in assembling ultra-small components. One engineer stated, "All issues must be quickly identified, solutions proposed, and their effectiveness verified." He emphasized the need for careful evaluation to ensure product quality without impacting the overall project schedule, especially when design changes occur.
Meanwhile, the Vietnam R&D center is also playing a role in software development. The Samsung Vietnam R&D center participated in the development and optimization of the multi-panel feature for the Samsung Notes application for the Galaxy Z Fold 8. Le Suan Hoa, head of the application solutions department at Samsung Vietnam R&D center, expressed pride in the fact that code developed in Vietnam contributes to products used daily by millions worldwide.
* This article has been translated by AI.
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