HP, Asus and Acer are reducing previously planned notebook production moves to Southeast Asia and shifting capacity back to Chongqing or Kunshan in China, while increasing orders and private-label manufacturing through Chinese ODMs (companies that design and manufacture products for brands) and EMS providers (electronics manufacturing services firms). Production lines at Quanta, Inventec’s Thailand plant, Compal and Wistron’s Vietnam plants could be affected by customer transfers, while Lenovo, Dell and Apple are making comparatively few changes. The shift follows a U.S. Supreme Court ruling that found the United States’ reciprocal tariffs unconstitutional, reducing the impact of replacement tariffs. Southeast Asian notebook production costs average $9 more per unit than production in China. With notebook gross margins generally ranging from 3% to 10% and low-cost models averaging about $300, the cost difference can approach or exceed profit per unit, making some shipments uneconomical. Chinese local governments are also urging factories to raise output as tax revenues decline, warning that previously granted subsidies could be reclaimed otherwise. ODM companies say they will follow customer decisions and may switch unassigned production to servers, networking equipment and other product lines. Lenovo’s diversified manufacturing footprint limits the scale of any return, Dell has not moved aggressively because of its relatively high share of U.S. government orders, and Apple’s Vietnam plan remains unchanged as it focuses on premium products and automation. Apple’s earlier MacBook move away from Shanghai was primarily driven by pandemic-related supply-chain disruptions.