Fitbit Shifts Smartwatch, Tracker Production Out Of China

| Published: Thursday, October 10, 2019, 16:52 [IST]

Fitbit is moving its manufacturing base out of China in the rise of US tariff impositions. All of Fitbit's health trackers and smartwatches will be shifted elsewhere, but there's no indication of another country/region. Fitbit says the move is to avoid being subjected to US tariffs on Chinese imports.

Fitbit To Move Out Of China Soon

Fitbit's decision to move out of China for manufacturing will certainly have financial implications. The company said it would announce these implications in its third-quarter earnings. However, the shares of Fitbit dropped 2 percent at the NYSE, further reducing the company stocks to 27 percent this year.

Fitbit, based out of San Francisco, is joining the list of US companies moving its production base out of China. Tom Forte, an analyst at D.A. Davidson, who has a buy rating on Fitbit says that the stock market doesn't give high value or enough credit for the tech companies in their attempt to mitigate tariff-related risks.

Fitbit Affected By US-China Trade War

The ongoing trade war between the US and China has many implications for many tech-based companies. GoPro also announced that it would move its camera production out of China, abiding the new rules of the US government.

In addition, Tile, maker of the Bluetooth-enabled location tracker, is thinking of moving out of China. Tile says it's considering Malaysia, Vietnam, Mexico or even the US for its future production base. Apple too is having another battle with the US government. Apple has been requesting the White House to get its products, including the iPhone, off the list of Chinese-made goods slated to be hit with tariffs on December 15. However, Apple is thinking of India for its future manufacturing base.

A lot of companies depend upon China for their manufacturing. Soon, trade negotiators will begin talks again. The last trade talks were initiated in May, but have since fallen apart. However, this time, China is open for a partial trade deal with the US, an insider says.