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Foxconn's new factory in Vietnam exploded: Switch will survive until 2027! Will Switch 2 be delayed further?

2024-08-03

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As we all know, Nintendo has officially announced the successor to the Switch, the Switch 2. Nintendo said that the new machine will be launched in the new fiscal year, which means it will be unveiled in April 2025 at the earliest, and may be delayed to March 2026 at the latest. Previously, a former Famitsu editor speculated that Nintendo will continue to give the Switch a lifespan and leave enough time for the Switch 2 to prepare its game lineup, and the Switch 2 may be delayed until the end of 2025. Now there is new evidence that the Switch 2 may not be launched so soon.

Foxconn's project to build two new factories in Vietnam has recently been approved. According to the introduction, the project includes two industrial parks with a total investment of US$551 million (about RMB 3.987 billion).

Foxconn's first project is located in Song Khoai Amata Industrial Park (also known as Amata City Ha Long), with a planned investment of US$263.7 million (currently about RMB 1.92 billion), covering an area of ​​21.5 hectares, mainly producing smart entertainment products, with an annual production capacity of 4.18 million pieces (a total of 4,335.3 tons). The second project is located in Bac Tien Phong Industrial Park, with an investment of US$287.2 million (currently about RMB 2.092 billion), covering an area of ​​12.4 hectares, focusing on the production of smart system equipment.

In fact, Foxconn started to move its factories to Vietnam a long time ago, because the labor in Vietnam is cheaper, and tax incentives are more attractive. Therefore, it is not surprising to build a new factory. What is surprising is that Switch is also there.

According to the disclosed details, the factory located in Song Khoai Amata Industrial Park specializes in the production and assembly of electronic components and equipment, with a planned annual production of4 million Nintendo Switch consoles(4,180 tons). The project is expected to be constructed from January 2025 to June 2026, with trial production scheduled to begin from October to December 2026 and production to begin in January 2027.

The relevant production details have also been released. That’s right! This newly built factory is still producing switch OLED, not the rumored switch2.


What's even more terrible is that this factory will be put into production in January 2027, which means that in 2027, the switch OLED is still in mass production, and the output is still 4 million units. And it is a newly built factory, which means that Nintendo hopes that the switch OLED will continue to be produced and sold for several years after 2027.

However, this does not mean that Switch 2 will not be launched until 2027. Because although the current Switch sales have declined, according to the latest financial report, the annual sales can still reach 15.7 million units, so the annual output of 4 million units is only a quarter of the current latest annual sales.

So what can we guess from Foxconn’s new factory?

1. Nintendo is already preparing to mass-produce Switch 2

The plan to build a new factory at this time and produce the Switch three years later means that Nintendo is freeing up the production of existing factories to prepare for the mass production of the new Switch 2. All subsequent factories will focus on assembling the Switch 2. This new factory is specifically used to keep the Switch alive.

2. Switch will be sold together with Switch 2

Judging from Foxconn's layout, it means that the Switch will continue to be sold until 2027, or even for several years after that. This means that after the launch of the Switch 2, it will be sold together with the Switch and coexist for several years.

This means that the price gap between Switch 2 and Switch will widen, otherwise the two machines cannot coexist. So the question is, will Switch 2 be priced higher, or will Switch price drop?

3. It’s just a smokescreen

Maybe this new factory was originally planned to be used to produce Switch 2, but for reasons of confidentiality, Nintendo did not want Switch 2 to be leaked at this time, so it said that the factory was planned to build Switch. After it goes into production in 2027, it will be used directly to produce Switch 2.

Which one do you think is more likely?