Lenovo CEO Yang Yuanqing has spoken on the tariffs put in place by the Trump administration, stating that the company was caught off guard by the abrupt tariffs on Chinese goods in March, but is prepared for future challenges. Yang stated that the primary difficulty isn't the tariffs themselves, but the unpredictable nature of their implementation.
"The challenge is not the tariff itself, it’s the uncertainty," said Yang, the CEO of the Chinese company that is one of the world’s largest personal-computer makers, referring to the sudden tariff announcements that have unsettled markets since US President Donald Trump took office, as per The Wall Street Journal.
In March, when the US unexpectedly raised tariffs on Chinese goods to 20% from 10%, Lenovo "had no time to prepare," Yang revealed. He estimated the move had a more than $15 million impact on Lenovo’s business, noting, "20% is not a small number."
Subsequent tariff escalations by the US led to retaliatory measures from Beijing, though a temporary agreement has since seen a reduction in most duties. President Trump has also paused "reciprocal tariffs" on other trading partners.
Lenovo is faster in adjusting to tariffs, says CEO
In this trade landscape, Yang expressed confidence that Lenovo's diversified manufacturing footprint across 11 countries, encompassing both in-house and outsourced production, will enable the company to adapt to tariff shifts more quickly and effectively than competitors.
While tariffs invariably increase costs, Yang asserted that "as long as we know what the end game is, we will adjust quickly." He emphasised that maintaining Lenovo's position as the industry's lowest-cost producer is crucial for gaining market share and boosting profitability.
Yang recalled how the company faced high tariffs in markets like Brazil and India in the past, and responded by establishing local factories.
Lenovo will continue to manufacture in China
While analysts believe Lenovo is planning to shift production of US-bound PCs from China to Vietnam by the end of June, Yan said the company is not withdrawing from China.
"China still gives us a lot of advantages in manufacturing," he said, citing its cost-efficiency and overall effectiveness.
"The more diversified you are, the more resilient you are," he added.
"The challenge is not the tariff itself, it’s the uncertainty," said Yang, the CEO of the Chinese company that is one of the world’s largest personal-computer makers, referring to the sudden tariff announcements that have unsettled markets since US President Donald Trump took office, as per The Wall Street Journal.
In March, when the US unexpectedly raised tariffs on Chinese goods to 20% from 10%, Lenovo "had no time to prepare," Yang revealed. He estimated the move had a more than $15 million impact on Lenovo’s business, noting, "20% is not a small number."
Subsequent tariff escalations by the US led to retaliatory measures from Beijing, though a temporary agreement has since seen a reduction in most duties. President Trump has also paused "reciprocal tariffs" on other trading partners.
Lenovo is faster in adjusting to tariffs, says CEO
In this trade landscape, Yang expressed confidence that Lenovo's diversified manufacturing footprint across 11 countries, encompassing both in-house and outsourced production, will enable the company to adapt to tariff shifts more quickly and effectively than competitors.
While tariffs invariably increase costs, Yang asserted that "as long as we know what the end game is, we will adjust quickly." He emphasised that maintaining Lenovo's position as the industry's lowest-cost producer is crucial for gaining market share and boosting profitability.
Yang recalled how the company faced high tariffs in markets like Brazil and India in the past, and responded by establishing local factories.
Lenovo will continue to manufacture in China
While analysts believe Lenovo is planning to shift production of US-bound PCs from China to Vietnam by the end of June, Yan said the company is not withdrawing from China.
"China still gives us a lot of advantages in manufacturing," he said, citing its cost-efficiency and overall effectiveness.
"The more diversified you are, the more resilient you are," he added.
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