People have been talking about this since the mid-90s. Most of the "shakers and movers" doing business in China have been planning their next move in Asia for years...
The currency changes (9% compared to the USD so far), and policy changes in the country, are making it more competitive while improving opportunities for local corporations thus creating a level playing field.
No longer do Chinese employees choose a foreign company to work for as a first option. There are a few local companies that have implemented very good business practices and could be considered world class.
However, on the flip side, there are still many years yet before business should be completely abandoned as they write in the article. A company needs to fully understand how to do business in China, and the tools necessary to be successful. In fact, there are still opportunities in the western part of China where the government is promoting growth.
The areas that are affected by increasing wages and cost are the giant super-cities along the east-coast where good employees are becoming more difficult to find. This is because there is always another company willing to pay more for their talent, driving up the cost for labor... The cost for services and materials are also driven upwards because of the increased demand in those cities.
The main reason those companies shut down, or are in the red, is because of poor management and bad planning.
Samsung is not moving to Vietnam because of the Chinese market conditions, but they are opening a new plant in Vietnam because of the opportunity for business in Vietnam and neighboring countries.
The main reason those companies shut down, or are in the red, is because of poor management and bad planning.
You can always say that. Well-managed company can even survive world-wide economic depression, for sure. Still, the exodus of such company relfects worsening business condition in China.
I heard that Samsung's new plant in Viet Nam will service Europe and other areas. It may service S.E. Asia, but it is only a part of it.
There could be more opportunities deep inside China. However, as export hub, they may not meet the requirement of many foreign companies.