HP, Asus and Acer are moving some PC production from Thailand and Vietnam back to China to cope with soaring component costs, Nikkei reports, citing industry sources. The sources say Dell, the third-largest PC maker, is considering a similar move.
Those costs come from the same AI-driven squeeze behind the memory crunch and the circuit board worries PC makers already face, and now it’s changing where PCs get built.
The move partly reverses China+1, the push that shifted production from China into Southeast Asia as US-China tensions brought trade restrictions. HP and Asus built facilities in Vietnam and Thailand as part of it.
In January 2023, Nikkei revealed that Dell aimed to stop using China-made chips by 2024 and had asked suppliers to help prepare capacity in countries like Vietnam. “This trend looks irreversible,” a supplier executive told Nikkei at the time.
Taiwan’s big PC contract manufacturers, Quanta, Compal, Inventec and Foxconn, are increasingly busy with higher-margin AI data center servers. That leaves room for smaller Chinese contractors such as Luxshare, Huaqin Technology and Longcheer Technology to win more PC orders.
Luxshare, a major iPhone assembler, is already winning them: its PC joint venture, LuxPC Union, has secured orders from HP, Dell and Asus over the past year, according to Nikkei.
The Chinese contractors also have access to memory chips made in China. That counts for a lot while the global shortage leaves PC makers with less bargaining power over memory supply.
We’d call this move irreversible, but we’ve learned our lesson. Let’s just all wait and see what happens next.
