Tariffs are rethinking production strategies for companies, said Singapore-based Flex LTD.
Globally, tariffs have become more relevant to production strategies as the United States imposes unilateral conditions to allow access to its market, while several affected countries respond with retaliatory tariffs or other trade restrictions.
With 100 facilities in 30 countries, Flex is a multinational electronics manufacturing services (EMS) and design (ODM) company with legal headquarters in Singapore and operational offices in Austin.
Production strategies
Flex, with a workforce of approximately 148,000 employees, stresses that increasing global uncertainty in recent years, including trade and tariff issues, growing geopolitical unrest and severe labor shortages, are creating greater complexity.
Recent tariffs imposed by the current U.S. administration and retaliatory tariffs imposed by other countries are accelerating these trends. As a result, companies are rethinking their production strategies.
Flex has judgmental authority: its business is diversified: 43% of net sales in North America, 17% in China, 21% in Europe, the Middle East and Africa and 19% in other areas, according to data for its fiscal year ended March 31, 2025 (with net sales attributable to the country in which the product is manufactured or the service is provided).
What does this company say as part of its production strategies? Flex sees a global rebalancing of sourcing and production locations to maximize resilience and reduce time to market.
At the same time, with sustainability as an area of ongoing focus, companies are held to much higher standards in how and where their products are sourced and produced, and, increasingly, in how they are serviced and disposed of.
A Chinese case
China’s Yuchai International Limited Yuchai believes that the current production capacity of all its engine lines will enable organic business growth through its product offering and portfolio.
However, Yuchai “cautiously evaluates” the continuous upgrading and improvement of manufacturing capacity to meet market expectations.
Yuchai also continuously analyzes customer experience and designs production strategies to take advantage of market opportunities.
Yuchai is one of the leading suppliers of propulsion system solutions in China. It specializes in the design, manufacture, assembly and sale of a wide variety of light-, medium- and heavy-duty engines for trucks, buses, vans, construction and agricultural equipment, as well as marine and power generation applications.