(File photo)

Chinese telecommunications company Huawei started on Tuesday relocating 2,700 of its employees from the R&D department and other departments from Shenzhen to neighboring city Dongguan in South China’s Guangdong Province.

Reports say the firm used 40 trucks for 60 trips between the two cities.

Dongguan Songshan Lake is very close to Shenzhen Bantian, where the Huawei headquarters is located. The new Dongguan facility is only about one hour’s drive from the Shenzhen headquarters, and a daily shuttle bus arranged by Huawei is serving the route.

Reports earlier this year suggested that Huawei could provide some 30,000 apartments for employees in Dongguan.

The company has not responded to requests for comment on the rumors. However, an employee told National Business Daily, “The rumors are mostly true, but only employees based in Songshan Lake are eligible to buy the apartments, and the properties cannot be traded as ordinary commercial properties five years after purchase.”

The Beijing News reported that Shenzhen has already experienced several rounds of corporate migration. Foxconn, a multinational electronics contract manufacturing company, and other manufacturing industry giants have migrated to Zhengzhou, Guizhou and other cities with lower labor and land costs.

Huawei needs large amounts of land for R&D and manufacturing.

“Every company needs a certain amount of space for development. There are too many real estate properties in Shenzhen and there is no large industrial land”, Ren Zhengfei, Huawei’s chief executive officer, once said.

Other important factors may be closely related to the rising cost of land and labor in Shenzhen in recent years, according to The Beijing News.

Huawei officials said in April the Shenzhen People's Government and Huawei signed a cooperation agreement to “take root in Shenzhen and look to the future” to show that Huawei will stay in Shenzhen and will not relocate.

According to the agreement, the Shenzhen Municipal Government will continue to deepen the reform of the business environment and actively provide quality assurances and services for Huawei's business development.

Huawei will increase investments in Shenzhen to realize the industrialization of new technologies and new businesses in Shenzhen and build an international headquarters.

“Our headquarters’ base will always be in Shenzhen, which is Huawei's core of global leadership", Huawei’s chief Ren Zhengfei said in April.

(Compiled by Shi Haina)