(Photo by Justin Sullivan/Getty Images via Getty)
HP is responding to Trump's tariffs on Chinese goods by moving a large portion of its manufacturing out of the country.
In an earnings call last week, HP CEO Enrique Lores said the PC maker has been laying the groundwork over “the past few years” to ensure "manufacturing resiliency.”
“We have made significant progress,” he said. “And by the end of fiscal year 2025 [on Oct. 31], we expect more than 90% of HP products sold in North America will be built outside of China."
HP didn’t say where it will move its manufacturing, but Lores noted that the company has been expanding its footprint “across multiple countries to meet growing customer demand and multi-source production.” However, the company is keeping at least some of its manufacturing in China to churn out products “for the rest of the world,” he added.
The bad news is that HP is signaling it could still impose price increases for products, given that it will take time for the company to shift its manufacturing. The other issue is that Trump has been eyeing tariffs on foreign-made chips, including those from TSMC, which builds processors for AMD, Qualcomm, and Nvidia.
“Should additional tariffs be implemented we would manage them the same way we have with China, leveraging the flexibility of our global supply chain network, along with cost improvements and pricing actions as needed,” according to Lores, who noted that about 30% of HP's revenues come from the US market.
PC suppliers Acer and ASRock are also preparing to move product manufacturing out of China to markets including Vietnam and Taiwan to head off the tariffs. But in the interim, Acer is preparing to introduce a 10% price hike for Chinese-assembled laptops sold in the US. The price hikes are also expected to rise since Trump plans on imposing another 10% tariff on Chinese goods on Tuesday.