Dell will cut use of ‘made in China’ chips by 2024 –report

U.S. based computer maker Dell is reportedly planning to phase out Chinese-made chips in its products by 2024.

Nikkei Asia reports that the company told suppliers late last year to significantly reduce other Chinese-made components in its products amid US-China tensions. Including those produced at facilities owned by non-Chinese chipmakers but still located in China.

IN PHOTO: Dell XPS 13 (2019)

Dell also asked suppliers outside China, like Vietnam, to help prepare capacities in production of other components such as electronic modules and print circuit boards, as well as product assemblers.

HP is also said to have begun surveying its suppliers to gauge feasibility of moving production and assembly away from the region.

“Previously, we knew Dell kind of had plans to diversify from China, but this time it is kind of radical. They don’t even want their chips to be made in China, citing concerns over the U.S. government’s policy,” a chip supplier to Dell and HP told Nikkei Asia. “…This trend looks irreversible.”

The US has seen to broaden its crackdown on China’s chip sector, citing concerns over national security. Most recently, the Biden administration added to a trade blacklist the Chinese AI chipmaker YMTC and 21 ‘major’ Chinese players in AI chip sector last December 2022.

US also imposed several strict export controls that included a measure to cut China from semiconductors made anywhere globally with US equipment.

The report also cited Canalys that Dell and HP have shipped over 133 million laptop and desktop units in 2021. That these economic trade tensions are apparently forcing companies to shift the PC supply chain, including assembly, outside of China.

Counterpoint tech analyst Ivan Lam told Nikkei that more manufacturing bases in India, Southeast Asia, and Latin America may begin to emerge over the next five to 10 years if this trend continues.