HP shifts production away from China

HP is undertaking a major shift in its manufacturing strategy, aiming to move more than half of its personal computer production out of China.

The move, driven by geopolitical concerns and supply chain resilience, marks a significant departure for the tech giant.

To mitigate risks associated with China and Taiwan, HP is establishing a backup design hub in Singapore.

The company is in advanced talks with suppliers to implement this plan within the next two to three years, with an ultimate goal of producing up to 70 per cent of its notebooks outside China.

Thailand is emerging as a key production hub for HP. At least five suppliers are setting up new facilities or expanding existing operations in the country to meet the increased demand.

The company is also bolstering its presence in Singapore by hiring 200 engineers and professionals to establish an alternative design centre. This move is designed to safeguard against potential disruptions caused by geopolitical tensions in the Taiwan Strait.

HP shipped approximately 52 million PCs in 2023, solidifying its position as the world’s second-largest PC maker. The company’s decision to diversify its supply chain follows a trend among other tech giants, including Dell, Apple, and Microsoft, which have also taken steps to reduce their exposure to China.

Attribution: The Nikkei Asia