Compal Electronics' plants in Vietnam have started mass production in small volumes and currently have about 100-200 workers. Compal aims to recruit a total of 2,000, according to a Chinese-language Apple Daily report.

Compal has invested US$500 million in the Vietnam plants and will use the production lines to manufacture smartphones.

Facing China's rising labor costs and growing strict labor laws, Compal has decided to shift a small portion of its smartphone production to Vietnam in order to lower risks.

With the establishment of a smartphone supply chain hub in Northern Vietnam almost completed, production in Vietnam will grow competitive in terms of labor costs. Shipments from Vietnam will mainly rely on air transport.

Some component makers in Southeast Asia revealed that Thailand's average wage is only 70-80% that of China, and the Philippines is about 50%.

Compal's Vietnam plants are expected to contribute 10-15% of Compal's smartphone shipments in the fourth quarter and the percentage will rise to 25% in 2016. Compal also plans to start producing notebooks at the plants after Vietnam's harbor is established in 2017, and will shift about 10-15% of its notebook production to Vietnam in the first year.