Big Blow For China! HP Shifting Production Of Millions Of PCs To Thailand, Mexico

Taipei: PC and printer major HP is reportedly shifting production of millions of consumer and commercial laptops to Thailand and Mexico this year, in a bid to diversity its supply chain beyond China.

According to a report in Nikkei Asia, this is the first “substantial move” by US-based company to move its personal computer supply chain beyond China.

“HP is also planning to shift some laptop production to Vietnam, starting next year, one of the suppliers said,” according to the report.

The company is following Dell and Apple in diversifying their supply chains beyond China that went through significant disruptions in the pandemic.

“HP is planning to shift some commercial notebook computer production to Mexico, while a portion of its consumer laptop production will go to Thailand,” the report claimed, citing sources.

The global PC shipments saw a 15 per cent decline (year-on-year) in the second quarter (Q2) of 2023 but rose 8 per cent (quarter-on-quarter).

Lenovo maintained its leading position in PC shipments despite an 18 per cent (year-on-year) decline, while HP and Apple showed solid performance with market share growth, according to Counterpoint Research.

After seven consecutive quarters of year-over-year decline, the PC market is showing initial signs of stabilisation, including sequential growth from the previous quarter, according to Gartner.

Gartner expects that PC inventory will normalise by the end of 2023, and PC demand will return to growth starting in 2024, he added.

HP shipments fell only slightly in the second quarter, ending a string of consecutive double-digit declines. Its laptop shipments grew modestly but were offset by a decline in desktop shipments, said the report.