UPS Survey: Asia Intra-Regional Trade to Grow as Labor Costs in China Rise

According to a survey conducted by IDC Manufacturing Insights, rising costs in China are prompting high-tech companies in Asia to explore alternative sourcing locations within the region as well as in North America.

By ·

A new UPS-sponsored survey suggests that high-tech manufacturers may be the first to decrease their dependence on China for sourcing.

According to a survey conducted by IDC Manufacturing Insights, rising costs in China are prompting high-tech companies in Asia to explore alternative sourcing locations within the region as well as in North America.

Carla Huang, UPS director of marketing, high-tech/electronics segment told LM in an interview that as part of this shift, half of all high-tech trade lanes in five years’ time are expected to involve intra-Asia movements.

“These shifts in sourcing strategies will impact high-tech supply chains in Asia as well as in North America, creating long-term implications for the industry on a global level,” said Huang. “To prepare for these changes, high-tech companies should re-examine their sourcing strategies and their supply chain as a whole to ensure they are in a position to continue meeting customer demand,”


The survey revealed that 19 percent of high-tech company respondents plan to source supplies and raw materials from North America in the next three to five years.  Forty-two percent of respondents reported they currently source supplies and raw materials from mature APAC countries, including Thailand, Malaysia, Hong Kong and Singapore. When looking ahead to the next three to five years, this figure jumps to 55 percent. Similarly, 16 percent of companies now source from emerging countries such as the Philippines and Vietnam, while 24 percent plan to source supplies from these countries in the future.

Findings come from an annual survey sponsored by UPS, “Change in the (Supply) Chain,” which is designed to uncover top business and supply chain trends driving change in the high-tech/electronics industry. The 2011 survey queried senior-level decision makers at high-tech companies in the Asia Pacific region.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Global · Global Logistics · Logistics · All Topics
Latest Whitepaper
Is Your Logistics Strategy Keeping Pace with Your Manufacturing Efficiency?
U.S. manufacturers continue to invest in world-class technology and innovation, as a growing number of businesses choose to expand U.S.-based production — or return manufacturing from Asia.
Download Today!
From the April 2017 Issue
While adoption rates have remained relatively flat, yard management systems (YMS) are helping logistics operations turn that important space between the loading dock and the gate into a vital link in the supply chain.
Information Management: Wearables come in for a refit
2017 Air Cargo Roundtable: Positive Outlook Driven by New Demand
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Maximize Your LTL Driver Adherence with Real-time Feedback
This webinar shows how companies are using real-time performance data to optimize the scheduling of their city fleets, as well as the routing of their standard, accelerated and time-critical shipments.
Register Today!
EDITORS' PICKS
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...

ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...