Usually the Western corporation will simply tolerate it and pay up…since the product is by then making loads of money anyway.
The Far Eastern companys can easily do this because they know that the Western SMPS industry has now been so denuded that the capacity just isnt there to take the jobs back.
Lol, no. Contracts are negotiated almost permanently. With every round, chinese suppliers are squeezed like a lemon and pitted against each other. The idea that chinese companies can just jack up the prices is ludicrous. If they did that, the next contract would go another chinese company offering it at 0,02$ cheaper or to Vietnamese companies or wherever the next big pool of cheap labor is to be found.
Unless you've spent a long time in the electronics business in Asia its hard to fully grasp the extent of this. For a lot of business that has a government hand in it there will always be protectionism. The biggest problem a Chinese company faces there is to make their offer so attractive that they can overcome the desire to keep local businesses in the target market alive. Where customer choice is free, Chinese companies are simply competing with other Chinese companies these days. If they are an important company, they may get assistance from their provincial government. However, they are in competition with Chinese companies in other provinces, who get aid from their provincial government. Provinces competing with each other looks insane to an outsider, but maybe it creates a level of competition that works to keep people on their toes. The bottom line is a foreign buyer can essentially play off one subsidised Chinese company against another. Walmart is king.
I doubt many Vietnamese companies will win a lot of electronics business in the near term. What is happening is Chinese companies win the business, but more and more of the high labour content is executed in Vietnam, Indonesia, or elsewhere. Similar to the way a Samsung phone or Epson printer is now generally assembled in a Vietnamese plant, from a polished kit of parts that avoids most of the need for good logistics connecting the Vietnamese plant with numerous component sources.
USA and Germany are the Western countries that have retained the most “in country” electronics manufacturing…and its no surprise that they are the richest and most wealthy Western countries, which prooves my point.
No, it doesn't. Neither the USA or Germany produce commodity power supplies. They may make some speciality industrial/military or whatever (and this is most certainly not limited to the USA or Germany) but they sure as hell won't make the wall warts that go with whatever dingus that are boxed with electronics or whatever.
You're probably not wrong that the reflex to produce everything in the Far East, always, is wrong. But the example you chose is just plain wrong. There's no added value in mass producing power supplies around here.
The USA and Germany have taken different paths. The US has given up on most electronics manufacture. It has, however, kept a big chunk of the component business, especially semiconductors. Semiconductor assembly and test left the US in the 60s and 70s, and wafer fabrication is now joining it, but the US still has many of the strongest semiconductor companies. With most new design teams being set up in China or India that may change.
Germany was one of the first western countries to truly embrace China as both a manufacturing centre, and a market. You see this in the early strength of companies like VW in China. Germany still has a lot of electronics business, and are more prepared than most countries to use automation to keep local manufacture viable. However, German business is well connected to China, and anything that works out cheaper being done in China goes there.
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