Amid the continued weakness in the global economy and the deteriorating international trade environment, the manufacturing industry in Guangdong is facing a new wave of closures. On June 30, a long-established lighting factory in Nansha, Foshan, specializing in exports, and a well-known foreign enterprise in Dongguan both announced their closure, signaling the end of their operations.
Several interviewees mentioned that these companies’ main orders come from the United States and Europe, but with the continuous shrinkage in export volumes this year, it is projected that nearly half of the lighting enterprises in the Zhongshan area will close by the end of the year.
Affected by the global economy and the serious impact of the US-China trade tensions, the manufacturing sector in Guangdong is rapidly contracting. The lighting factory in Nansha, Foshan, issued a public letter on June 30 to notify suppliers and customers that due to “international situations, economic downturn, and other factors, the debts outweigh the assets, making it impossible to continue operations.” It was decided to cease operations immediately, with follow-up arrangements to handle related financial matters according to the law. The factory has been active in international lighting exhibitions since the last century, well-known for its stable overseas clientele and excellent quality products.
A business service professional, Ms. Chen, who had participated in lighting exhibitions alongside the factory at the Hong Kong International Lighting Fair, expressed her sorrow in an interview with Epoch Times on July 3: “They had a loyal group of foreign customers. Hearing their closure announcement is truly saddening.”
Ms. Chen revealed that since May, overseas orders in the lighting industry have significantly decreased. “If I didn’t switch to the domestic market in time, our company wouldn’t have been able to survive,” she said. She indicated that in Zhongshan alone, it is expected that almost half of the lighting factories will shut down or halt production within the year.
The owner of a lighting factory in Changsha, Hunan, Mr. Tan Dalin (pseudonym), who has operated lighting enterprises and foreign trade factories in Beijing and Changsha for nearly twenty years, stated to the Epoch Times that his businesses would cease production this month and focus on operating his branch in Vietnam. He said, “The impact of the US-China trade war on us is far greater than the epidemic. Although transportation is faster now than before, without orders and facing high tariffs, it’s simply unsustainable.”
Unlike local enterprises in Foshan, even foreign giants find it challenging to thrive independently. Celestica’s subsidiary, Tianhong (Dongguan) Technology Co., Ltd., under the Canadian Celestica group, issued a dissolution notice on June 25 announcing the initiation of dissolution procedures at the end of June, effectively terminating labor contracts with employees from July 1.
The notice stated that the dissolution was a result of “responding to market changes and adjusting the company’s future strategy.” It pledged to lawfully compensate employees economically, with relevant procedures already filed with local authorities.
Established in 2004, Tianhong Technology had a registered capital of $32.5 million, headquartered in Songshan Lake, Dongguan, providing subcontracting services for international technology brands like IBM, HP, and Cisco. occupying 236 acres, with over 500 employees, it was a key manufacturing base for Celestica in southern China. According to the group, Celestica has over 40,000 employees globally and has been rated as one of the top 100 IT companies in the world by Businessweek.
A former state-owned enterprise employee in Dongguan, Ms. Wu, mentioned in an interview the dissolution of Tianhong was closely related to its North American clients accelerating the transfer of production capacity due to geopolitical risks. “Production lines are now shifting to Mexico, Vietnam, and Eastern Europe; China is no longer the preferred option. ‘Made in China’ no longer carries the favorable image in Western markets, and is increasingly seen as a competitive risk.”
Apart from Foshan and Dongguan, several enterprises in Zhongshan have recently deregistered their industrial production licenses. According to an announcement by the Market Supervision Administration of Zhongshan, the industrial production licenses of Jinshengwei Paper Industry and Fuying Daily Chemical Products Co., Ltd. were deregistered due to “production discrepancies with commitments.” Although the announcement did not directly state closures, it reflects the compliance pressures and survival challenges faced by the manufacturing industry in Zhongshan.
Official statistics indicate that in the first quarter of 2025, 22 companies moved out of Zhongshan, mainly relocating to Foshan, Guangzhou, Zhuhai, indicating a quiet but tangible restructuring process in the regional industrial structure.
Multiple industry insiders have expressed that the current situation of China’s local manufacturing industry is “more severe than the most difficult period of the epidemic,” with traditional factories reliant on foreign trade being hit the hardest. Ms. Wu candidly shared, “Trade wars, tariff barriers, overseas clients shifting production bases, combined with rising domestic operating costs, multiple factors are accelerating the trend of ‘de-Chinafication’ of the manufacturing industry.”
Ms. Chen, who operates a lighting business, added, “Previously, we could maintain cooperation based on quality, relationships, and customers, but now even customers have disappeared. It’s not a problem of just one company; the entire industry ecosystem is facing challenges.”