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Hit by rising component costs and tight supply due to the AI boom, PC makers such as Acer, Asus and HP have reported that they will move some production back to China from Thailand and Vietnam, and let Chinese OEMs handle more purchasing and manufacturing responsibilities.
Japanese media reported that in response to the trend of artificial intelligence (AI), which has increased the cost of many components, Taiwan’s Asus andacer And personal computer (PC) makers like HP in the United States are shifting some production.Thailand China moved back with Vietnam and adopted a new batch of lesser-known OEM manufacturers.
The report quoted multiple sources as saying that as the cost of materials and parts rises, PC makers are looking to improve manufacturing efficiency, and China is still the best choice due to its experienced production workers, low prices and the ability to obtain complete components of various types.supply chain Ecosystem.
The director of a chip supplier, whose customers include major PC brands, pointed out that “this wave of migration is really driven by cost pressures.” “The prices of not only memory chips but also other components are rising so rapidly that it is becoming increasingly difficult for PC makers to absorb the price increases.” Therefore, “we are moving some production back to China and cooperating with more Chinese foundries because these foundries can provide highly competitive prices.” “If the cost environment does not improve, more production may be moved back to China.”
An executive at an e-sports PC maker said: “The price of DRAM (memory chips) alone has increased at least eightfold in a year… not to mention the rising costs of central processing units (CPUs), printed circuit boards (PCBs) and passive components.” “Since the (US additional) PC tariff issue has been put on hold, certainly we are looking at manufacturing in China again.”
Additionally, PC makers are also turning to some lesser-known Chinese foundries. LuxPC Union, a PC design and manufacturer jointly founded by Luxshare Precision and Liulian Intelligence, has received orders from HP, Dell Technologies (DELL) and Asus last year, according to people familiar with the matter.
In addition, as the global supply of memory chips exceeds demand, reducing the bargaining power of PC manufacturers, Chinese foundries may also source China’s domestic memory chips.
A computer industry supply chain manager revealed, “These Chinese foundries are telling potential customers and computer manufacturers that working with them is a good option to get more Chinese-made memory chips.” “They show themselves to be a good alternative and can also help solve supply chain problems.”
Representatives from emerging industries such as Huaqin and Longchir have visited large PC makers such as HP, Asus and Acer more frequently this year, the sources said.
The report notes that Acer has handed over more purchasing responsibilities to Chinese foundries to assist in the procurement of components such as processors and memory chips as a “low-intervention” measure to reduce the burden of internal procurement.
Another PC company official said, “HP, Dell, Lenovo and Asus have also followed suit and opened Chinese foundries to handle more component procurement responsibilities for similar mid-range and entry-level PC projects.” “Sharing such key responsibilities has facilitated the rise of Chinese foundries, particularly traditional Chinese second-tier suppliers such as Shenzhen Weibo Information and Great Wall.”
“In some cases, Chinese electronics makers now have more power and control over the chips used in various PC models than smaller PC brands like Acer,” said the director of a chip developer whose customers include Acer, HP and Dell.
Many supply chain executives believe Southeast Asia will remain a strategic bastion of “China + 1” as US-China relations are not expected to improve significantly.
However, Counterpoint supply chain analyst Lin Qiu pointed out that China is benefiting from an existing electronic component ecosystem that is difficult to copy elsewhere. “Although the CPUs, graphics processing units (GPUs) and memory purchased by major brands often come from major global suppliers, China’s supply chain still has obvious advantages in other components, including peripheral components and structural parts. This is an area where the capabilities of other regions cannot match China’s.”
