Freight Volumes Surge at China-Vietnam Border, Supply Chain Linkages Underpin Vietnam's Manufacturing Expansion

According to foreign media reports, against the backdrop of additional U.S. tariffs, Chinese manufacturers have been successively setting up factories in Vietnam, driving deeper supply chain linkages between the two countries. In 2025, China's exports to Vietnam reached $198.11 billion, up 22.4% year-on-year, doubling the scale from 2019. In freight warehouses in Pingxiang, Guangxi, goods marked with logos of Foxconn, Nokia and multiple Apple suppliers are stacked, while aluminum profiles bearing BYD's logo are carried by workers to trucks waiting for departure. These goods, produced in major domestic manufacturing provinces such as Guangdong and Jiangsu, will make a brief stop before being transported via border crossings to various industrial zones in northern Vietnam to supply local production lines. Local freight drivers travel between the two regions five days a week. Under smooth conditions, a single customs clearance takes less than an hour, allowing up to three cross-border trips per day. The warehouse manager of logistics firm Chefuwang revealed that the current warehouse size is 17 times that of 2021, to match the surging demand for transporting industrial machinery, components and raw materials in Vietnam. Official public data shows that in the first half of 2026, the two-way trade value between China and Vietnam at the Pingxiang Friendship Pass port reached 30.56 billion yuan, up 28.3% year-on-year. Over the same period, the trade value at the China-Myanmar Ruili port stood at 3.45 billion yuan, and that at the China-Russia Manzhouli railway port reached 7.81 billion yuan. An economics professor at the China Europe International Business School analyzed that the smooth logistics network has turned Vietnamese factories into an extension of Chinese factories. The executive director of Hanoi-based consulting firm Ascentium noted that land transportation is more flexible than sea freight, enabling supply chains in South China to connect with Vietnamese factories within 10 hours. This advantage has made northern Vietnam one of the preferred locations for Chinese manufacturers to deploy production capacity. The minimum monthly salary in Vietnam's core industrial areas is approximately 260 Singapore dollars, a clear labor cost advantage compared to the minimum monthly salary standards of 1,750 yuan to 2,520 yuan in major manufacturing regions of Guangdong. The scale of industrial zones in Vietnam's Bac Ninh, Hai Phong and other areas continues to expand, with former rice paddies replaced by newly built roads, factories and supporting infrastructure. Most factories in Tu Son City, Bac Ninh Province, have posted recruitment notices outside, covering positions such as workers, engineers and accountants, with details on salary, benefits, social insurance and paid probation periods. Nearly 50 enterprises have settled in a 150-hectare industrial park in Do Son District, Hai Phong City, most of which are Chinese-invested. The Vietnamese subsidiary of Zhuhai-based G.Tech Technology moved into the industrial park in 2021. The company's deputy general manager said that the firm imports machinery and components from China to produce computer peripherals such as keyboards and mice for clients including Logitech and ASUS. It will also consider local procurement in the future if components that meet requirements are available locally. The company plans to add new production facilities in Vietnam, gradually increasing the share of production capacity in Vietnam to 60%, while retaining the remaining 40% in China. The chairman of the Vietnam China Business Council noted that the deployment of Chinese manufacturing in Vietnam has shifted from a short-term wave to a long-term trend. China's investment in Vietnam approached $4 billion in 2025, making it the second largest source of foreign investment in Vietnam after Singapore. Currently, there are 6,386 active Chinese-invested projects in Vietnam, with cumulative registered capital of approximately $36 billion. U.S. trade data shows that in the first half of 2026, Vietnam's trade surplus with the U.S. exceeded that of China, ranking first among all U.S. trading partners. Vietnam was subject to an additional 46% import tariff in 2025, which has now expired. In July 2026, U.S. officials launched inspections of Chinese-linked factories in Vietnam, leading to market concerns over the possibility of new U.S. tariffs on Vietnam. The Vietnamese government intends to promote the upgrading of its local industries up the value chain, avoiding long-term stagnation in the assembly and processing segment. The chairman of the Vietnam China Business Council believes that it is unrealistic to completely decouple from Chinese technology in the next 5 to 10 years. Currently, 70% to 80% of components and intermediate machinery equipment in the Southeast Asian market are supplied by China. Reducing reliance on external supply chains is a feasible goal, and Vietnamese enterprises can learn from China's development experience to grow into specialized suppliers. Leading brands such as Apple have entered the Vietnamese market for many years, and are currently pushing their Chinese suppliers at all tiers to set up factories in Vietnam. The aforementioned executive director of the Hanoi consulting firm noted that even if second, third and fourth-tier suppliers set up operations in Vietnam, they will ultimately still need to import raw materials and components from China. To adapt to the growing demand for cross-border freight, the Friendship Pass port has undergone multiple expansion and upgrading projects in recent years, with continuous improvement in traffic efficiency. According to relevant plans, a smart port is currently under construction locally, which will support driverless trucks to travel on designated border sections. The carrying capacity of freight trains running from Pingxiang to Vietnam has also been expanded, and the two countries are promoting the construction of a broader railway network.