HP, Asus and Acer are reportedly moving some PC manufacturing capacity from Thailand and Vietnam back to China as rising component costs put pressure on production expenses. The shift comes amid shortages of memory and storage chips driven partly by growing demand for artificial intelligence infrastructure.
The development was detailed in an October 28 report from Nikkei Asia, which cited industry sources familiar with PC manufacturing supply chains. Dell is also reportedly evaluating a similar move, although the company has not confirmed a production relocation.
The reported changes represent a partial reversal of the industry’s recent efforts to diversify manufacturing beyond China. Major PC brands had expanded production in Southeast Asia to reduce exposure to geopolitical tensions, trade restrictions and tariffs. However, China’s established supplier networks, experienced workforce and competitive manufacturing costs are becoming increasingly attractive as component prices rise.
AI infrastructure demand is a major factor behind the pressure. Memory manufacturers have been allocating substantial production capacity to data center customers, contributing to tighter supplies of DRAM and storage components used in consumer PCs. The situation follows warnings that memory supply shortages could persist through 2030 as demand continues to outpace available capacity.
Research firm TrendForce estimates that CPUs, DRAM and SSDs accounted for approximately 68% of a mainstream notebook’s bill of materials in the third quarter of 2026, compared with 45% in the first quarter of 2025. The increase illustrates how semiconductor costs are consuming a larger portion of manufacturers’ production budgets.
The pressure also extends beyond memory and storage. Rising material expenses and supply constraints affecting printed circuit boards and motherboard manufacturing have introduced additional cost challenges for PC hardware producers.
Chinese contract manufacturers are reportedly benefiting from the changing conditions. Companies including Luxshare, Huaqin Technology and Longcheer Technology are attracting orders from major PC brands as established Taiwanese manufacturers increasingly prioritize higher-margin AI server production.
According to Nikkei Asia’s reporting, LuxPC Union, a joint venture involving Luxshare and Sixunited Group, has secured orders from HP, Asus and Dell over the past year.
These Chinese contractors also offer potential advantages in component sourcing. Some have closer relationships with domestic memory producers such as ChangXin Memory Technologies (CXMT), providing another procurement option while international DRAM supplies remain constrained.
The changes are not limited to selecting different assembly partners. Some PC brands are reportedly allowing contract manufacturers to take greater responsibility for purchasing components, including processors and memory. Acer has adopted this approach to reduce its internal procurement workload, while similar arrangements are being explored for entry-level and midrange PCs.
However, the reported production shift does not mean manufacturers are abandoning their broader diversification strategies. Southeast Asian manufacturing remains important for reducing dependence on a single country, even as some orders return to China.
TrendForce estimates that the proportion of global notebook production taking place outside China will decline from approximately 24% in 2025 to 21% in 2026. The research firm expects that share could fall below 20% in 2027.
For consumers, including buyers of gaming laptops and prebuilt PCs, the development highlights how tight DRAM and high-bandwidth memory supplies are influencing decisions throughout the PC industry.
Moving production to lower-cost manufacturing partners could help PC makers manage expenses, but there is no confirmation that the changes will produce lower retail prices. Manufacturers still face elevated component costs, and the reported shifts have not been tied to specific gaming laptop models, product launches or consumer pricing adjustments.
The immediate development is a change in sourcing and manufacturing strategy rather than an announced reduction in PC prices. It also demonstrates how demand for AI infrastructure is affecting the production of conventional consumer computers, even when those systems are not intended for AI workloads.
