Dell Will Eliminate Chinese Chips From Its Products

Dell will reportedly no longer use Chinese-made chips in its computers beginning in 2024, the latest challenge to China's semiconductor industry....
Dell Will Eliminate Chinese Chips From Its Products
Written by Matt Milano
  • Dell will reportedly no longer use Chinese-made chips in its computers beginning in 2024, the latest challenge to China’s semiconductor industry.

    China has faced mounting pressure on its semiconductor industry as the US and allies have tried isolating China and restricting the country’s access to leading technology. Much of the action is driven by concerns over surveillance and espionage, with many Chinese companies having close ties to Beijing and it’s spying apparatus.

    According to Nikkei Asia, Dell plans to eliminate the use of chips made by Chinese firms. What’s more, the company also plans to phase out chips manufactured in China by non-Chinese companies.

    “The goal is quite aggressive. The determined shift involves not only those chips that are currently made by Chinese chipmakers but also at the facilities in China of non-Chinese suppliers,” one person with direct knowledge of the matter told Nikkei. “If suppliers don’t have responding measures, they could eventually lose orders from Dell.”

    HP has evidently has also expressed an interested in reducing or eliminating its dependence on China-based manufacturing facilities, but Dell’s move has certainly made waves in the industry.

    “There are thousands of components for notebook computers, and the ecosystem was so mature and complete in China for years,” a chip supplier exec that works with both Dell and HP told Nikkei. “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. … It’s not just an evaluation, it’s not crying wolf. It’s a real and ongoing plan, and this trend looks irreversible.”

    China’s semiconductor was reportedly on the verge of collapse as a result of US sanctions. China is already planning a $143 billion package to buoy its chipmaking industry. If other companies follow Dell’s example, however, it could result in the wholesale devastation of what remains.

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