Google is currently reassessing its Pixel smartphone production strategy in light of tariffs introduced during the Trump administration. The company is exploring the possibility of increasing its production efforts in India to mitigate tariffs imposed on imports from Vietnam, which has been its primary manufacturing hub for Pixel devices.

Ongoing discussions are taking place with local manufacturing partners in India to facilitate this shift. As of now, Google manufactures some devices in India, particularly with the release of the Pixel 8.

However, the tariffs that could significantly impact costs are leading the company to reconsider its manufacturing landscape. Reports indicate that Google is in negotiations with local contract manufacturers such as Dixon Technologies and Foxconn to transition a portion of its Pixel smartphone production from Vietnam to India.

This would enable Google to avoid higher tariffs on imports, as international tariffs for products from Vietnam are considerably steeper than those from India. The proposed changes could yield substantial savings for Google.

Specifically, the Trump administration has announced a 46% tariff on goods imported from Vietnam, compared to a 26% tariff for products coming from India. The financial implications of these tariffs could motivate Google to favor production in India moving forward, especially given the fluctuating nature of tariffs in recent times.

Currently, Dixon Technologies and Foxconn are producing about 43,000 to 45,000 Pixel smartphones per month in India, with Dixon responsible for approximately 65-70% of that output. As interest in Pixel smartphones grows in the U.S. market, having a robust production base in India could help Google maintain its momentum.

Last year’s models effectively doubled Google’s market share from 7% to 14% in the U.S., underscoring the importance of strategic production decisions in sustaining growth.