HP Plans To Shift Personal Computer Production Away From China

America’s leading PC maker, HP, is looking to move more than half of its computer production away from China and is planning to establish a “backup” design hub in Singapore to mitigate geopolitical risks related to China and Taiwan, Nikkei Asia reported.

These plans represent the most aggressive move by the PC maker, involving a significant shift of its supply chains from Asia’s largest economy. HP, which currently manufactures its PCs in China, is engaged in discussions with suppliers about this transition.

According to Nikkei Asia, which cited sources, HP aims to achieve this goal within two to three years. One source mentioned that the company has set an internal target of producing 70 percent of its notebooks outside of China.

Thailand is a likely destination for the shift in production.

How many tech giants are moving away from China?

In 2022, the Times of India reported that only a small portion of Apple’s latest iPhones will be produced in India, and some of Google’s new Pixel phones will be made in Vietnam, according to sources familiar with the companies’ plans.

This shift is a response to rising geopolitical tensions and supply chain disruptions caused by the pandemic that have affected China. China has long been the global hub for high-tech electronics, known for its skilled workforce and production capacity.

Lior Susan, founder of Eclipse Venture Capital, said, “China’s dominance in manufacturing is being challenged. More investments are moving away from China to find alternatives.”

This shift is impacting Asia, leading to higher industrial land prices in Vietnam, a boost in manufacturing in Malaysia, and increased demand for low-wage workers in India. As China faces its slowest economic growth in decades, it is losing some of its manufacturing activity.

Despite this, China remains the leading producer of consumer electronics. However, production is moving elsewhere: Apple is now making iPads in northern Vietnam, Microsoft has shipped Xbox consoles from Ho Chi Minh City, and Amazon is producing Fire TV devices in Chennai, India. Previously, all these products were made in China.