Fitbit has announced that it has undertaken a plan to shift its manufacturing operations outside of China for effectively all of its trackers and smartwatches. As a result, starting in January 2020, the company expects those products will no longer be of Chinese origin and therefore not subject to Section 301 tariffs.
“In 2018, in response to the ongoing threat of tariffs, we began exploring potential alternatives to China,” says Ron Kisling, CFO of Fitbit. “As a result of these explorations, we have made changes to our supply chain and manufacturing operations and have additional changes underway. Based on these changes, we expect that effectively all trackers and smartwatches starting in January 2020 will not be of Chinese origin.”
The company will provide more details of the financial implications of these tariff mitigation efforts during its upcoming third quarter earnings conference call.