Lenovo, HP, and Dell are considering expanding their manufacturing operations to Saudi Arabia, according to Digitimes. The Kingdom is encouraging technology companies with existing facilities in China to shift production to the Arabian Peninsula due to concerns over tariffs.
Lenovo has already announced plans to establish a PC and server assembly plant in Riyadh, supported by a $2 billion investment from a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), as reported by Digitimes. HP and Dell are also evaluating opportunities, with teams visiting Riyadh to assess potential sites after invitations from local authorities.
Saudi Arabia is also reaching out to major original design manufacturers (ODMs) such as Foxconn, Quanta, Wistron, Compal, and Inventec. However, these firms are cautious, citing the importance of established supply chains and logistics, which are currently more robust in countries like Vietnam, Thailand, and Mexico.
To attract these companies, Saudi Arabia is offering incentives including reduced tariffs—10% for goods entering the U.S. from Saudi Arabia compared to 245% from China, according to Digitimes—and promises of government contracts and support for factory construction. Access to African markets is another key factor influencing decisions, particularly for Lenovo.
Lenovo’s CEO, Yuanqing Yang, stated that the investment will provide the company with significant resources to expand in the Kingdom of Saudi Arabia and the broader Middle East and Africa region. The new facility is expected to be operational by 2026.
This initiative is part of Saudi Arabia’s Vision 2030 strategy, which aims to diversify the nation’s economy beyond oil and establish it as a global trade center. Ongoing shifts in global trade policy and tariffs are prompting companies to consider new manufacturing bases to ensure stability and growth.
