Microsoft plans to move most new product production out of China by 2026 Microsoft is preparing to manufacture a majority of its new products, including Surface laptops and data center servers, outside of China starting as early as 2026, according to Nikkei Asia. The company has asked multiple suppliers to explore options for producing not just the final products, but also key components and assemblies abroad. This move is part of a broader effort to reduce reliance on China amid ongoing U.S.-China tensions.
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Amazon Web Services is also shifting supply chains away from China AWS is following a similar path, particularly for its AI data center servers. The company is even evaluating whether it can reduce dependence on long-time Chinese suppliers, such as PCB manufacturers, though replacing these partners is challenging because they have long-standing relationships and high-quality production. AWS’s strategy highlights the difficulties of moving supply chains at the component level.
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Google is expanding server production in Southeast Asia Google has asked its suppliers to grow server production capacity in Thailand, with some assemblers doubling capacity by building new facilities. The tech giant is creating an ecosystem where suppliers handle everything from parts and components to assembly in Thailand, giving Google alternative options outside of China for its server infrastructure.
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The push is driven by geopolitical and trade concerns U.S. tech companies like Microsoft, AWS, and Google are reducing dependence on China to prevent potential disruptions from tensions between Washington and Beijing. China recently introduced new export controls on rare earths and battery materials, while the U.S. threatened further tariffs. Geopolitical risks across the Taiwan Strait are also pushing these companies to diversify production elsewhere.
Moving production beyond China is challenging but necessary Shifting assembly is relatively straightforward, but moving production down to individual components like fibers, cables, and PCBs is much more difficult. Some components remain cheaper and easier to produce in China, making the transition complex. Despite past efforts and tariffs, this is the first time top U.S. tech companies are aiming for such a comprehensive supply chain shift, including both finished products and critical parts.
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