Southeast Asian Appliance Makers Ramp Up Output As Chinese Firms Shift Supply Chains
SINGAPORE - Major home appliance manufacturers across Southeast Asia are expanding factory capacity rapidly this year, as Chinese brands relocate production to avoid Western tariffs and meet fast‑growing local consumer demand, industry executives and trade data show.
Vietnam, Thailand and Indonesia have become key new production hubs for air conditioners, refrigerators and small household appliances, with combined factory output projected to rise 18% year‑on‑year in 2026, according to the ASEAN Electrical and Electronic Association.
Midea Group, Haier Smart Home and TCL Technology have all opened or enlarged assembly plants in Vietnam and Thailand over the past 12 months. These facilities mainly produce goods for export to Europe, North America and other ASEAN markets, bypassing higher import duties levied on Chinese‑made finished products.
Meanwhile, local Southeast Asian brands are gaining market share in low‑cost small appliances such as electric kettles, rice cookers and fans. Indonesia's Polytron and Thailand's Panasonic factories reported double‑digit sales growth in the first quarter, supported by rising household disposable income and urbanisation.
Trade analysts note that while production is shifting outward, most core components including compressors, control boards and chips are still imported from China. This creates a new trade pattern: China exports parts to Southeast Asia, where final goods are assembled and exported globally.
Regulatory changes are also driving investment. New energy‑efficiency standards in Vietnam, Malaysia and Singapore require updated production lines, encouraging firms to build newer, more modern factories in the region.
"ASEAN is no longer just a sales market for home appliances," said Lim Wee Kiat, chief economist at the Singapore Manufacturing Federation. "It is becoming a critical global production node reshaping the whole home appliance supply chain."
