Global Re-Shoring 2025: How Korea, Mexico, Taiwan, Vietnam, and China Are Reshaping the Supply Chain
Reshoring & Friend-Shoring: How Korea, Mexico, Southeast Asia, India – and ETFs – Fit Into the New Map
📘 Part 1. Reshoring & Friend-Shoring: Why Mexico, Korea, Southeast Asia, and India Are All Heating Up Macro backdrop
In 2025, the global supply chain landscape looks completely different from the pre-pandemic world. Just a few years ago, the idea that “China = the world’s factory” felt like an unshakable rule. Today, the “China + 1 (or + N)” strategy has become the default operating model for multinational manufacturers.
At the center of this shift are three key concepts:
- Reshoring: bringing production back to the home country
- Near-shoring: moving production to nearby countries
- Friend-shoring: restructuring supply chains around political and economic allies
Within this new framework, Korea, Mexico, Vietnam (and broader Southeast Asia), and India are emerging at the same time.
In this Part 1, we’ll take a data- and case-driven look at “why now,” “why these four regions,” and “what this means for global investors.”
■ Post-pandemic supply chain failures
From 2020 to 2023, manufacturers worldwide watched logistics and procurement bottlenecks hit their P&Ls directly.
According to a study in the Journal of International Economics (2023):
- Average delivery times for global manufactured imports rose by about 21 days compared to 2018
- Resulting disruptions cut finished output by around 7.3%
- Average prices charged by firms rose by around 1.8%
In other words, relying on a single China-centered supply chain is no longer “efficient” when you factor in cost and competitiveness.
■ Geopolitics: US–China tensions directly shaping corporate decisions
The U.S. has formalized a “less China, more allies” approach through the 2022 CHIPS and Science Act and the 2023–2024 Inflation Reduction Act (IRA), explicitly pushing strategic production into the U.S. and friendly countries.
The U.S. Department of Commerce has effectively stated:
“For strategic items like semiconductors, batteries, and critical minerals, only production in the U.S. or in FTA partner countries qualifies for tax credits and subsidies.”
In practice, that means:
- If your factory is in China, you don’t get the tax benefits
- → If your factory is in Korea, Mexico, Southeast Asia, or India, you can qualify
That is a structural cost gap.
For companies, “policy is cost.” Once that shifts, production moves.
■ What companies are actually doing: the numbers
According to Supply Chain Insights (2024):
- 90% of global manufacturers have already implemented some level of reshoring or near-shoring
- About 50% of those have shifted at least 20% of production
- More than 70% of U.S. manufacturers say “securing production outside China” is a top priority
Reshoring is no longer optional – it’s now a standard playbook.
Korea is not just “another competitive manufacturer.” It has become a core country in high value-added manufacturing: semiconductors, batteries, EVs, and precision components.
■ Semiconductors: a critical anchor in the global chain
- Memory share: Samsung + SK hynix control over 70% of the global DRAM market
- HBM (high-bandwidth memory): the core memory for AI servers, effectively dominated by Korean firms
AI and data center build-out → exploding demand for chips → higher strategic importance for Korea. This feedback loop is what channels reshoring tailwinds into Korean semi names.
■ Batteries: the biggest IRA winner in North America
Between 2024 and 2025, more than 50% of announced capex for North American battery plants involves the “big three” Korean battery players (LG Energy Solution, Samsung SDI, SK On).
Since IRA rules penalize content from China in the EV battery supply chain, Korean companies are moving into a quasi-monopoly position for qualified supply.
■ How foreign investors now see Korea
Korea is increasingly perceived as:
- A core hub of U.S.-aligned tech supply chains
- A coordinator of Southeast Asian production bases
- A key buyer of advanced semiconductor equipment
- A central node in the global battery network
As reshoring gains momentum, Korea is being re-rated as a supplier of critical technology, components, and intermediates.
The goal of reshoring isn’t just to “replace China.” Companies are looking for new optimal locations that combine logistics, tariffs, labor, and political stability.
Mexico, Vietnam/Southeast Asia, and India fit that profile better than most.
■ Mexico: the backbone of the North American supply chain
● Reason ①: sharing a land border with the U.S.
Products can reach U.S. plants in 1–2 days by truck. Compared to Trans-Pacific shipping, that cuts lead times by roughly 80%.
● Reason ②: USMCA trade agreement
To qualify for tariff benefits, goods sold in the U.S. need a certain share of North American content. That gives firms a strong reason to put plants in Mexico.
● Industry examples
- Mexico is already the 6th-largest auto and electronics assembly base globally
- Exports of electronics to the U.S. are central to its trade structure
- Samsung and LG maintain key TV and appliance production in Mexico
For U.S. manufacturing revival, the biggest beneficiary isn’t China – it’s Mexico.
■ Vietnam & Southeast Asia: the most realistic alternative to China
● Reason ①: labor costs
Based on 2025 estimates:
- Average hourly wage in Vietnam: about $2.99
- Average hourly wage in China: around $6.50
With rising costs in China, Vietnam has become a sustainable alternative for many manufacturers.
● Reason ②: electronics and assembly clusters
- Samsung, LG, and Apple’s major suppliers have been operating plants in Vietnam for over a decade
- Vietnam’s industrial production growth has held in the 8% range into 2025
- Exports to the U.S. reached roughly $85.1 billion in the first half of 2025
The “China + Vietnam” model has effectively become a new global standard.
■ India: the strategic center for the next decade
India combines:
- The world’s largest population
- High GDP growth (around 7%)
- Expansion in smartphones, semis, and auto parts manufacturing
- A government pushing aggressive incentives for manufacturing (via schemes like PLI)
That’s why India is emerging as a new manufacturing powerhouse in Asia.
As Apple, Foxconn, and Samsung expand production there, India is evolving from “China’s backup” into a self-sustaining industrial ecosystem.
Reshoring is not a short-lived fad – it’s a structural, long-cycle shift. For investors, the theme offers both upside and real risks.
■ Opportunities
● 1) Production shifts → export growth
Mexico, Vietnam, Korea, and India all sit in a position to directly absorb demand from the U.S. and EU.
● 2) Rising FDI (foreign direct investment)
As global production networks relocate, new plant construction accelerates. Southeast Asia and India are seeing record levels of FDI inflows.
● 3) Industrial upgrading
Supply chain realignment isn’t just about low-end assembly moving around. Batteries, semiconductors, and higher value-added segments are moving with it.
■ Risks
● 1) Infrastructure and logistics issues
Road, port, and power infrastructure differs widely by country. Academic work shows that logistics delays can directly erode corporate profitability.
● 2) Geopolitical risk
- U.S.–China strategic competition
- Tensions in the Taiwan Strait
- South China Sea disputes
- Border clashes between China and India
When production hubs are exposed to these flashpoints, return volatility can spike.
● 3) Currency volatility
Emerging market currencies can be volatile. For ETF and equity investors, FX is a key part of the risk budget.
✦ Bottom line
Reshoring and friend-shoring do not mark “the end of the China era.” They mark the beginning of a multi-polar supply chain era.
At that starting line, Korea, Mexico, Vietnam, and India have all moved into central positions in different parts of the global network.
📘 Part 2. Semiconductors, Batteries, Autos – Role Sharing Across Korea, Taiwan, Mexico, and China Supply chain structure
As global manufacturing supply chains are rebuilt, the biggest changes are appearing in the advanced manufacturing value chain running through semiconductors → batteries → EVs → auto parts.
These industries are all tagged as “national security assets” in the U.S. and Europe. Policy-makers are trying to reduce reliance on China, and that is speeding up friend-shoring to allied countries.
In that process, Korea, Taiwan, Mexico, Vietnam, and China are taking on distinct roles. That division of labor is one of the most important inputs for any forward-looking investment strategy.
Below, we break down the roles by country and sector in a way that’s meant to be intuitive for investors.
Semiconductors sit right at the front line of supply chain realignment. The U.S. and EU have both committed to cutting their dependence on China for advanced chips. As a result, equipment, materials, packaging, and foundry work are shifting into Korea and Taiwan.
■ Korea: core in memory, HBM, and advanced packaging
Korea is the single most important country for memory production.
- DRAM share: Samsung + SK hynix control over 70% of global DRAM
- HBM share: the key memory for AI servers – effectively dominated by Korean producers
With AI server capex hitting record highs in 2025, Korean memory makers are being revalued as systemically important suppliers in the global ecosystem.
On top of that, as customers look to diversify away from single points of failure in packaging, some of the packaging and OSAT work traditionally tied to Taiwan is drawing more interest toward Korean back-end players and equipment makers.
✔ Quick summary of U.S. policy
- CHIPS Act: subsidies restricted to the U.S. and allied locations
- Limits on advanced equipment sales into Chinese fabs
- → Korea and Taiwan become natural alternative suppliers
■ Taiwan: the undisputed foundry powerhouse
Taiwan is the center of the global foundry industry.
- TSMC’s global foundry share: roughly 55%
- Advanced nodes (5nm/3nm): the U.S., Europe, and Japan all rely heavily on Taiwan
- Most of the world’s key chip designers – Apple, NVIDIA, AMD, Qualcomm – depend on TSMC
The reason the U.S., Japan, and Europe are racing to host TSMC fabs locally is simple: there is essentially no substitute for its leading-edge process.
✔ How Korea and Taiwan fit together
They compete, but also complement each other.
- Korea: primarily memory
- Taiwan: primarily foundry
- The U.S. and EU: define both as “core supply chain partners”
Because China can’t easily replicate the full cutting-edge stack on its own, the strategic value of Korea and Taiwan continues to rise.
As the EV market scales up, the supply chains for batteries, components, and assembly are being rebuilt just as quickly.
In this space, we can clearly see a triangular structure: Korea for core technology → Mexico for North American assembly → Vietnam/Southeast Asia for low-cost assembly and processing.
■ Korea: global leader in cells, modules, and materials
The “Big 3” Korean battery makers (LG Energy Solution, SK On, Samsung SDI) are widely seen as the largest beneficiaries of the IRA in North America.
- Over 50% of announced North American battery plant capex involves Korean firms
- Joint ventures with GM, Ford, Stellantis, and others are accelerating
- Korea is one of the only countries with strong capabilities across cylindrical, prismatic, and pouch cells
Korea is not just a “battery producer.” It is also at the center of the supply of key materials – cathodes, anodes, electrolytes, separators – through a dense midstream ecosystem.
Because IRA restricts EV subsidies if “foreign entities of concern” are involved in battery content, Korean companies are effectively moving into a near-monopoly position for compliant supply into North America.
■ Mexico: the final assembly and distribution hub for North America
Mexico is one of the fastest-growing hubs for auto and EV assembly in the world.
The reasons are straightforward.
- Land border with the U.S. → lead times down to 1–2 days
- USMCA → qualifying production counts as “North American” and enjoys tariff and tax advantages
- Relatively low-cost but increasingly skilled manufacturing workforce
Mexico’s auto parts sector is tightly integrated with U.S. OEMs, and Korean, Japanese, and German tier-1 and tier-2 suppliers are expanding capacity there.
- As of 2024, Mexico is the 7th-largest auto producer globally
- Over 80% of Mexico’s auto and auto parts exports go to the U.S.
With more battery modules, electronics, and EV assembly moving into Mexico, the country is becoming the key hub for intermediate and final assembly in North America.
■ Vietnam & ASEAN: low-cost, high-volume production base
Southeast Asia offers:
- Low labor costs
- A large and young workforce
- Aggressive manufacturing incentives
- Long-standing production relationships with Korean, Taiwanese, and Japanese firms
- A growing role as a global assembly and processing center
That’s why the region is emerging as a key hub for midstream EV components and battery pack assembly.
In Vietnam specifically:
- Industrial production growth runs in the 8% range as of 2025
- Exports to the U.S. reached roughly $85.1 billion in the first half of 2025
- Major electronics makers – Samsung, LG, Foxconn, Goertek – operate module and assembly plants
In autos, Vietnam and its neighbors are seeing rapid growth in electronics and battery pack assembly lines as well.
The narrative that “China is finished” is an exaggeration. In reality, China’s role is being redefined.
A number of reports converge on the same conclusion:
“China is no longer the sole hub of global manufacturing, but it is increasingly focused on production for its own domestic market.”
In practice:
- Production in China → primarily for Chinese domestic demand
- Production outside China → increasingly in Korea, Taiwan, Mexico, Vietnam for global markets
This is the “two-track” structure that’s taking shape.
■ Key points on China’s adjusted role
- China’s domestic market is still among the largest in the world
- Its manufacturing infrastructure and skilled workforce remain strong
- In some areas – solar, EVs, mid-range electronics – China still holds dominant share
- But for U.S.-bound production, China’s position has weakened sharply
As a result, global firms are essentially adopting a strategy of “We can’t fully exit China, but we can’t rely only on China either.”
If you understand the upside and downside for each of the key countries, it becomes much easier to choose ETFs, stocks, and sector themes.
■ Korea
Strengths
- Dominant position in memory and HBM
- Best-in-class technology in battery cells and materials
- A full ecosystem across EV electronics, modules, and secondary batteries
Weaknesses
- Rising wages and manufacturing costs
- Geopolitical balancing act between the U.S. and China
■ Taiwan
Strengths
- TSMC-led dominance in foundry
- Essential hub for AI chip manufacturing
Weaknesses
- Heightened geopolitical risk with China
- Potential dispersion as the U.S., Japan, and Europe push for local fabs
■ Mexico
Strengths
- Geographic integration with the North American market
- USMCA benefits
- Rapid growth as an EV assembly and parts hub
Weaknesses
- Gaps in power and logistics infrastructure
- Skill mismatches in parts of the workforce
- Relatively small domestic market
■ Vietnam & Southeast Asia
Strengths
- Low-cost, high-volume assembly capability
- Existing networks with Korean and Taiwanese electronics makers
- Government incentives to attract manufacturing
Weaknesses
- Infrastructure, power, and port constraints
- Limited pools of highly specialized labor in some fields
- Political and policy stability risks in certain markets
■ China
Strengths
- Huge domestic market
- Deep and broad manufacturing base
- Global dominance in certain sectors (solar, EVs, mid-range electronics)
Weaknesses
- Regulatory and trade pressure from the U.S. and EU
- Eroding competitiveness as an export production base in some segments
- Rising geopolitical risk premia
✦ Summary: the new map of manufacturing
After reshoring and friend-shoring, the emerging structure looks like this:
- Korea & Taiwan → advanced technology hubs
- Mexico → North American assembly and distribution hub
- Vietnam & Southeast Asia → high-volume, cost-efficient production hubs
- China → domestic market and select high value-added segments
This is not a short-term adjustment. It’s a decade-plus realignment of the global manufacturing base.
For investors, the job is to integrate:
- Where each industry sits in the supply chain
- What role each country plays
- Where companies are building new capacity
- How geopolitical risks cluster
- How U.S. and European policies are evolving
and then build portfolios that can ride the structural wave while managing regional risk.
📘 Part 3. Reshoring Through ETFs and Individual Stocks Turning it into trades
Supply chain realignment is no longer just about policy or industry structure. It is already showing up as direct investment opportunities in public markets.
Between 2024 and 2025, global institutions have started to put capital to work in ETFs and stocks directly tied to the reshoring theme – Mexico, Vietnam, India, Korea, and U.S. infrastructure among them.
In other words, reshoring and friend-shoring are now flowing from “policy → corporate capex → portfolio positioning” – a rare, large-scale megatrend.
In this Part 3, we’ll walk through:
- ① Country ETFs
- ② Sector ETFs
- ③ Key beneficiaries in single stocks
- ④ A practical portfolio framework
with an eye on how you can actually implement the theme.
The most direct way to capture reshoring is through country ETFs. At the end of the day, factories depend on: policy, tariffs, labor, logistics, and geopolitical alignment – all of which are country-level variables.
That’s why many global investors use these ETFs as their primary lens on supply chain shifts.
✔ (1) Mexico ETFs – top beneficiary of North American reshoring
Key ETFs
- EWW (iShares MSCI Mexico ETF)
- FLMX (Franklin FTSE Mexico ETF)
Mexico’s leading role in the reshoring trade is not an accident. The logic is very clear.
● Core drivers
- Shared land border with the U.S. → much shorter shipping times and lower inventory needs vs. Asia
- USMCA → significantly lower tariff costs for qualifying production
- Established clusters in autos, electronics, and battery pack assembly
- Growing concentration of EV and battery-related plants in North America
● On-the-ground flows
Since U.S. tariffs and restrictions on China ramped up in 2024–2025, U.S. and global manufacturers have been moving or adding plants in Mexico.
The ramp-up is visible in:
- Hyundai and Kia capacity in Mexico
- LG and Samsung consumer electronics production
- Japanese auto suppliers
- U.S. EV manufacturers’ electronics and components assembly
→ Investment takeaway
If the U.S. keeps pushing reshoring within North America, Mexico’s equity market – via EWW or FLMX – has structural tailwinds for the next 5–10 years.
✔ (2) Vietnam & ASEAN ETFs – at the center of the China + 1 strategy
Key ETFs
- VNM (VanEck Vietnam ETF)
- ASEA (Global X ASEAN ETF)
- EIDO (iShares Indonesia ETF)
● Why Southeast Asia?
- Labor costs less than half of China in many cases (Vietnam: about $2.99/hour vs. China: about $6.50/hour)
- Large footprints from Samsung, LG, and Apple’s critical suppliers
- Explosive growth in assembly and processing for electronics and apparel
- FDI surges around ports and special industrial zones
● Actual metrics
- Vietnam’s industrial production growth in the 8% range as of 2025
- Exports to the U.S. hitting about $85.1 billion in the first half of 2025
→ Investment takeaway
With strong roles in electronics, textiles, IT components, and battery pack assembly, Vietnam and ASEAN markets offer a long-duration growth story tied to “China + 1.”
✔ (3) India ETFs – scale, tech, and manufacturing in one package
Key ETFs
- INDA (iShares MSCI India ETF)
- SMIN (iShares MSCI India Small Cap ETF)
- PIN (Invesco India ETF)
● Why India is structurally interesting
- The world’s largest population with rapidly rising consumption
- Incentive-driven push to attract smartphone, semiconductor, and auto production
- Strong IT and software foundation to support advanced manufacturing
- Visible commitments by Apple, Foxconn, and Samsung to ramp up output
→ Investment takeaway
India is one of the few emerging markets where exports, manufacturing, domestic demand, and IT are all growing at the same time – a powerful backdrop for a 2025–2030 horizon.
✔ (4) Korea ETFs – the high-tech backbone of supply chains
Key ETFs
- EWY (iShares MSCI Korea ETF)
- FLKR
- KORU (leveraged Korea ETF)
● Korea’s edge
- Dominant in memory and HBM (Samsung, SK hynix)
- Major IRA beneficiary in EV batteries
- Tier-1 producer of auto electronics and modules
- Robust ecosystem of semi materials and equipment
- Expanding manufacturing bases in North America, Southeast Asia, and Europe
→ Investment takeaway
Reshoring is essentially the story of surging demand for higher-spec components. That makes Korea a shadow beneficiary of factory relocation, even when the plants themselves are built elsewhere.
Once you’ve set the stage with country ETFs, sector ETFs help you see where capital is actually concentrating.
✔ (1) Semiconductor ETFs – the #1 reshoring sector
Key ETFs
- SOXX
- SMH
- XSD
● Why semis?
- Surging capex in AI and data centers
- Rising chip content across EVs, batteries, industrial automation, robotics, and IoT
- Structural shift away from China → more capacity in Korea, Taiwan, the U.S., and Europe
→ Investment takeaway
Semiconductors sit at the heart of the reshoring story – combining secular growth with a geopolitical tailwind.
✔ (2) Battery and EV supply chain ETFs
Key ETFs
- LIT (Global X Lithium & Battery Tech)
- BATT
- KARS (KraneShares Electric Vehicles and Future Mobility)
● Growth drivers
- IRA-driven investment in North American EV and battery plants
- Rising share for the big three Korean battery makers
- Expansion of assembly-related capacity in Mexico and Southeast Asia
- European decarbonization and REPowerEU infrastructure plans
→ Investment takeaway
Even if headline EV sales growth slows, investment in the underlying battery and power infrastructure will likely keep growing.
✔ (3) U.S. infrastructure and logistics ETFs
Key ETFs
- PAVE (U.S. infrastructure)
- XTN (U.S. transportation)
- IGF (global infrastructure)
At its core, reshoring means building new factories and new logistics corridors. That requires rails, roads, ports, warehousing, and power.
- Railways, highways, ports, and storage capacity
- Electricity grid upgrades and generation
- Industrial parks and related construction
→ Investment takeaway
Infrastructure, steel, and heavy equipment companies are the “hidden beneficiaries” of the reshoring cycle.
Once ETFs give you the top-down direction, you can look at single names sitting at critical points in the supply chain.
✔ (1) Korean companies
- Samsung Electronics – memory, foundry, and AI-related packaging
- SK hynix – #1 in HBM
- LG Energy Solution – leading North American battery partner
- Samsung SDI – focused on premium battery markets
- SK On – joint ventures with Ford and Hyundai
- Hyundai & Kia – Mexico-based production boosting North American share
→ Korean firms form a global “components and technology” hub.
✔ (2) Taiwanese companies
- TSMC – #1 global foundry
- UMC – beneficiary of demand for mature-node foundry capacity
- ASE – major player in back-end packaging
- MediaTek – levered to smartphone and IoT demand in emerging markets
→ As reshoring accelerates, global dependence on Taiwanese foundries is likely to remain high.
✔ (3) Mexican and Southeast Asian names
- Mexican auto electronics and assembly companies
- Vietnam’s Vingroup – spanning autos, batteries, and electronics
- Port, logistics, and industrial park developers across Vietnam and Malaysia
→ More production in North America means a larger role for Mexico-centered supply chains.
✔ (4) U.S. infrastructure and logistics companies
- Union Pacific / CSX – railways
- Caterpillar / Deere – industrial and construction equipment
- Nucor / Steel Dynamics – U.S. steel production
→ Because reshoring requires rebuilding physical infrastructure, U.S. infrastructure names can benefit throughout the cycle.
A practical framework might look like this:
➤ Step 1. Use ETFs to capture the big picture
- Mexico (EWW)
- Vietnam (VNM)
- India (INDA)
- Korea (EWY)
- Semiconductors (SMH / SOXX)
- Batteries (LIT)
- U.S. infrastructure (PAVE)
➤ Step 2. Narrow down to likely winners within each country and sector
For example:
- Mexico reshoring → Hyundai, Kia, and key auto electronics suppliers
- Semiconductors → Samsung, SK hynix, ASML, TSMC
- Batteries → LG Energy Solution, SK On, Samsung SDI
- Infrastructure → U.S. railroads and heavy machinery names
➤ Step 3. Use diversification to manage geopolitical risk
A mix of U.S., Mexico, Korea, Taiwan, and ASEAN exposures can help spread risk across regions while still being anchored in the reshoring trend.
📌 Final thoughts
Reshoring and friend-shoring are not just another “theme trade.” They are part of a long-term structural reset that will likely run well into the 2030s.
The basic equation is:
Supply chains move → countries, sectors, and companies get repriced.
The four core pillars of the story are:
- ① Mexico: North America’s assembly and production hub
- ② Korea & Taiwan: high value-added, advanced technology centers
- ③ Vietnam & Southeast Asia: cost-efficient assembly and processing hubs
- ④ U.S. infrastructure: logistics, power, and factory build-out
Start with ETFs to capture the structural move, then use individual names to fine-tune your exposure – that’s one way to build a portfolio that can live through short-term volatility while staying plugged into long-term growth.
📚 Sources & References Short reference list
- OECD, Supply Chain Resilience Reports (2023–2024) – analysis of global bottlenecks and reshoring trends
- UNCTAD, World Investment Report 2024 – FDI flows and rising investment in Southeast Asia
- U.S. Department of Commerce, CHIPS & Science Act documentation (2022–2024) – policy on semiconductor supply chains and allied production
- European Commission, Trade & Industrial Policy Briefs (2023–2025) – Europe’s approach to diversification and strategic sectors
- Korea Institute of Finance (KIF), “Analysis of Global Supply Chain Realignment” (2024) – division of labor between Korea and Southeast Asia
- IMF, “Global Supply Chain Pressure Index” (2023–2025) – data on post-pandemic logistics pressures
- ASEAN, Investment Report 2025 – FDI trends in manufacturing, electronics, and batteries
- VanEck, iShares, SPDR ETF fact sheets (2024–2025) – portfolio composition and key metrics for reshoring-linked ETFs
- Korea International Trade Association, Trade Trend Reports 2024–2025 – data on exports from Vietnam, Mexico, and India
- Journal of International Economics (2023) – research on longer delivery times and production disruptions after COVID-19
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