US’s manufacturing service provider Key Tronic expanding in Vietnam despite tariff uncertainties

Key Tronic, a leading American design and manufacturing service provider, is proceeding with the buildout of new production capacity in Arkansas (U.S.) and Vietnam despite tariff uncertainties.

The rapid and unprecedented changes in tariffs have significantly impacted the demand from Key Tronic’s customers, Brett Larsen, president and CEO of Key Tronic, said in a company report on results for Q3 ended March 29.

Uncertainties about tariffs have led to hesitancy and business paralysis in many of its customers’ businesses, Larsen said, adding that Key Tronic’s manufacturing footprint in the U.S., Mexico and Vietnam provides its customers with options to manage current tariffs and future tariff changes.

These new facilities will be operational in the first half of fiscal 2026, or the second half of 2025, he noted.

Larsen’s announcement reiterated Key Tronic’s February commitment to expanding in Vietnam.

In its review for the quarter ended December 2024 (Q2 of fiscal year 2025), Key Tronic said it plans to “significantly” increase its production capacity in Arkansas and Vietnam with a view to serving the growing customer demand for rebalancing their contract manufacturing.

Headquartered in Washington state, Key Tronic operates facilities in the U.S., Mexico, China, and Vietnam.

Its Vietnam facility is located in the central coastal city of Danang. Key Tronic received an investment registration certificate to invest $70 million in Danang in 2019, with an annual capacity of 100 million vehicle items.