Laptop production share outside China is expected to fall from 24% in 2025 to 21% in 2026 as PC makers rethink shifting production amid soaring component costs
TrendForce's latest notebook industry research reveals that the primary risk facing the market in 2027 is expected to shift …
Context & Ripple Effects
Notebook makers have pursued geographic diversification for years: HP and Dell were reported in 2019 to be planning a shift of as much as 30% of notebook production out of China, while Microsoft was reported in 2025 to be targeting overseas production for new Surface laptops. The revised outlook shows that relocation plans are being weighed against the cost of keeping a complete manufacturing chain running elsewhere.
The pressure is not limited to assembly. Expected declines in motherboard sales amid AI-driven component price increases indicate that higher memory, storage, and processor costs are already constraining the PC market's upgrade cycle.
First-order effects
- PC makers are expected to trim the share of laptop output assembled outside China from 24% in 2025 to 21% in 2026, slowing planned production diversification.
- Chinese assembly bases retain a larger portion of notebook orders, while factories outside China receive fewer allocations than relocation plans had implied.
Second-order effects
- Microsoft's reported plan to move most new Surface laptop production outside China faces a sharper cost-versus-diversification trade-off as component inflation raises the expense of building alternative supply chains.
- Higher component bills reinforce the weak upgrade demand reflected in projected motherboard-sales declines, putting PC OEMs under pressure to balance laptop pricing against unit volumes.
Third-order effects
- If component costs remain the binding constraint, supply-chain resilience in PCs will depend less on final assembly location and more on access to dense component ecosystems and constrained semiconductor inputs.
- TrendForce's forecast that data centers will consume more than 70% of high-end memory output in 2026 points to AI infrastructure competing with consumer electronics for supply, limiting how quickly laptop production can diversify.
The trend: AI-driven competition for semiconductor components is turning PC manufacturing diversification from a geographic decision into a supply-access decision.