Dell’s plan to reduce China exposure points to accelerated decoupling and supply chain diversification, analysts say
- Dell may move about 50 per cent of its production out of the country by 2025, according to Nikkei Asia and Taiwan media reports
- Analysts say more Big Tech brands are evaluating their exposure to China production amid increasing geopolitical headwinds
US personal computer giant Dell’s plan to cut China exposure by phasing out China-made chips by 2024 points to an accelerated decoupling process between the world’s two largest economies amid deepening Beijing-Washington mistrust, analysts say.
Dell declined to comment on the reports on Monday.
Dell’s reported plan to cut its China exposure is the latest incidence of global firms pulling some, or all, of their manufacturing operations out of China amid rising geopolitical tensions with the US and after supply chain disruption due to pandemic-related lockdowns.
Dell has gradually increased investment in China since it entered the market in 1995, with manufacturing sites in Xiamen, Chengdu and Kunshan, four research centres, 12,500 employees, and more than 12,000 retail stores in China, according to its recruitment website.
But this is set to reverse amid rising tech tensions between Washington and Beijing, which has seen the US impose trade sanctions on China in important tech sectors, such as semiconductors, in the name of national security.