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In response to the uncertainty surrounding Trump’s tariff policies, major tech companies are diversifying their supply chains to reduce potential risks. While countries like India have emerged as new hot spots, Tom’s Hardware notes that the three leading PC manufacturers—Lenovo, HP, and Dell—are reportedly considering expanding their operations into Saudi Arabia.
The report highlights that Lenovo has announced plans to build a PC and server assembly plant in Riyadh, backed by USD 2 billion from a subsidiary of Saudi Arabia’s Public Investment Fund. The facility is expected to become fully operational in 2026.
Earlier in March, Lenovo also revealed plans to produce all PC models for the Indian market locally within the next three years, according to a report from ijiwei, citing Fortune India.
In addition to Lenovo, HP and Dell have reportedly sent teams to Saudi Arabia to assess potential factory sites, as the report indicates.
Saudi Arabia Appeals More to OEMs than ODMs
Alongside its efforts to attract PC brands, Saudi Arabia is reportedly also courting major contract manufacturers (ODMs), including Foxconn, Quanta, Wistron, Compal, and Inventec to establish operations locally, as the report notes. However, these ODMs remain hesitant, as successful expansion requires more than just labor and infrastructure, while strong client demand and reliable logistics networks are equally crucial.
Currently, Vietnam and Thailand serve as the primary production hubs for ODMs like Foxconn outside China, while Mexico hosts facilities that leverage USMCA benefits to bypass U.S. tariffs, according to the report.
Saudi Arabia’s Strategic Advantages to Boost its Tech Industry
Saudi Arabia offers significant incentives to global tech companies, as the report points out. A key advantage is the preferential tariff treatment—products manufactured in Saudi Arabia face only 10% reciprocal tariffs when entering the U.S. Furthermore, the report adds that Saudi Arabia’s Public Investment Fund (PIF), with its USD 620 billion portfolio, is offering substantial financial incentives to attract major manufacturers to the country.
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(Photo credit: Lenovo)
