Zebra Technologies is shifting forward with plans to relocate extra manufacturing from China forward of looming tariff hikes, CEO Anders Gustafsson advised CNBC on Tuesday.
The Trump administration’s subsequent deliberate tariffs, scheduled for Dec. 15, goal shopper gadgets corresponding to toys, laptops and smartphones.
The electronics maker has already completed that for merchandise that had been hit by earlier tariffs, Gustafasson stated.
“We’re now shifting to different Southeast Asian international locations with our present companions they usually’ve been replicating our strains,” he stated on “Mad Money.”
Gustafsson’s interview with Jim Cramer follows information that the Lincolnshire, Illinois-based firm landed a contract with the U.S. Postal Service price greater than $500 million. It reported a mixed third quarter on Tuesday, however its shares rose nearly 7% on the day.
Zebra makes bar-code scanners, printers and different cell computing merchandise for companies. Cramer famous that he has been a long-time fan of the corporate.
Zebra Applied sciences’ determination to maneuver its provide chain out of China was in response to President Donald Trump’s long-running commerce warfare with the nation. Trump has known as for companies to move manufacturing elsewhere, together with to the U.S., in an effort to keep away from tariffs on Chinese language imports.
Trump stated earlier this month that the U.S. and China agreed to a preliminary “phase one deal” because the international locations attempt to finish the commerce warfare. Whereas nothing has been signed, officers have stated they had been “close to finalizing” the settlement.
If a deal is not reached by Dec. 15, that spherical of tariffs will still likely go into effect, Treasury Secretary Steven Mnuchin advised CNBC earlier this month.
When requested by Cramer if Zebra was involved in regards to the high quality of its merchandise that had been moved, Gustafsson stated he was not. He stated the corporate is working with established companions because it strikes to new factories.
“They are going into present amenities, so we predict the start-up difficulty must be minimal,” he stated.