On July 2, 2025, US President Donald Trump announced a tariff agreement with Vietnam. This agreement marks the first trade deal between the Trump administration and an Asian country, excluding China, signaling a shift in US trade policy in the region.
The 20% tariff rate aligns with earlier forecasts by Qisda chairman Peter Chen, who predicted rates between 10% and 20%. The deal aims to curb Chinese goods avoiding tariffs by transshipping through Vietnam while fostering bilateral trade.
Taiwanese supply chain companies with operations in Vietnam are adjusting their strategies in response to this new framework. Qisda, which directs about half of its display sales to the US market, is expanding its Vietnamese production capacity. The company plans to double its capacity by mid-2025 and triple it by year-end 2025 to offset tariff impacts and optimize supply logistics.
AUO reported that its exports from Vietnam remain exempt under a reciprocal tariff list, and thus are currently unaffected by the new tariffs. The company intends to maintain close communication with customers and monitor policy changes to sustain global production and supply chain resilience.
Innolux, acting primarily as a component supplier, stated that tariffs mainly affect the prices set by its brand clients. Vietnam's role as an assembly hub for notebooks underscores the importance of a stable trade environment for the technology sector, and the finalized deal is viewed as positive for ongoing industrial development.
Vietnam emerges as key base for display component manufacturing
Upstream suppliers of panel components, like backlight module manufacturers, are similarly boosting their presence in Vietnam. These modules do not directly face tariffs; rather, tariffs impact downstream system integrators. Coretronic and Radiant Opto-Electronics are among those rapidly expanding Vietnamese operations to meet demand and mitigate tariff risks.
Coretronic began leasing factory space in Vietnam in 2021 and commenced construction of a second plant in 2022. Their Vietnam facility currently operates two production lines and plans to launch further lines through 2026, aiming for a total monitor production of 10 million units by mid-2026.
Radiant Opto-Electronics is adhering to its Vietnam expansion plans despite the new tariffs, with backlight module production expected to start by the end of 2025. The company follows the relocation trends of Taiwanese contract manufacturers and serves both US clients and the automotive segments.
Global Lighting Technologies formed a Vietnam subsidiary in 2023, initiating construction in early 2024 with production lines planned to be installed through mid-2025. Small-scale trial production is forecasted for the third quarter of that year.
AmTRAN has operated its Vietnam facility in Haiphong since 2018, employing about 4,000 workers across five production lines. The factory produces a range of displays and electronic products, including TVs and interactive panels, leveraging Vietnam's growing role in regional manufacturing.
This trade agreement with Vietnam highlights a strategic redirection in US tariffs and trade policies as companies recalibrate supply chains to balance costs, market access, and compliance with evolving regulations.
Article edited by Charlene Chen
