Teradyne, a well-known American semiconductor manufacturer, withdrew its manufacturing business worth approximately US$1 billion from China last year, which was a difficult decision for them.The Suzhou factory is Teradyne's main production base for semiconductor test equipment. In the three months ended October 1 last year, the Chinese market accounted for 12% of Teradyne's revenue, down from 16% in the same period last year.
A Flextronics factory in Suzhou, China, is Teradyne's main manufacturing base for semiconductor test equipment. This also limits the factory's access to some U.S.-sourced parts needed to manufacture Teradyne equipment.
However, Teradyne responded that because the proportion of imported parts and components assembled from U.S. sources is higher than the proportion of U.S. sources that directly import complete machines, we moved the assembly factory from Suzhou to Malaysia out of supply chain security considerations.
In this way, the proportion of U.S. sources in our equipment can be kept below 3%, ensuring sales to most customers. Moving production bases to Southeast Asia is also a common practice for many companies (such as Advant).
Teradyne also reiterated that its business and support manpower in China continue to grow. China is their most important market and they will not give up.