No one in the global tech supply chain has a clear read on where US tariffs will finally land, but one truth is already cementing, that the deepest fault line will be between Washington and Beijing. The biggest casualties? Companies welded to China’s tightly integrated technology manufacturing ecosystem, with the US as their top shelf for sales.
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Smartphones and PCs are in the blast zone
Apple’s vast production web still runs heavily through China, making it one of the most exposed names in the game. PCs aren’t far behind. The triad of Dell, HP and Lenovo earns an estimated 15-20 per cent of operating profit from US sales, and with laptops more dependent on China than desktops, the risk premium is real. Higher costs will roll downhill to consumers, who account for 45 per cent of PC sales and the lion’s share of smartphone demand — a customer base that is notoriously price-sensitive.
In the second quarter of 2025, India became the top source of smartphone imports to the US, with 44 per cent of the total, while China’s share dropped to 25 per cent.
Vietnam and India are seemingly the fast-track alternatives
The diversification playbook is already in motion. Dell has shifted US-bound PC production out of China entirely. And, HP will follow by mid-year. Vietnam is emerging as the prime new hub for PC assembly, while India is catching the next big wave in smartphones. Apple’s India pivot could see most US-destined iPhones made there by 2026. Samsung, meanwhile, has a production footprint split between Vietnam and India, both offering the labour-cost advantage smartphones need.
But there’s a catch: if the current pause on US reciprocal tariffs for Vietnam and India ends, their advantage could shrink overnight. For now, the “China-plus-one” strategy is giving these countries a sweet spot in the global tech reshuffle.
In 2024, the US imported USD 114 billion worth of smartphones, making it the fifth most imported product. A significant portion of these smartphones, particularly those from India, are now featuring the “Made in India” label. India’s smartphone exports to the US have surged, with one in three imported smartphones now originating from India.
Why AI chips play by different rules
While PCs and smartphones sit in the tariff firing line, advanced chipmakers are dodging the worst. AI chips, dominated by Nvidia, have pricing power and diversified production. US-bound AI servers assembled in Mexico are tariff-exempt under the USMCA, and China now accounts for only a small slice of Nvidia’s data-centre revenue. Taiwan and Mexico are also feeding the AI boom, with Mexico enjoying tariff-free access and Taiwan exposed due to a lack of a free trade pact.
For the metals under question, aluminium comprises around 24 per cent of an iPhone’s mass, followed by iron, which makes up around 14 per cent of the device’s mass, according to a breakdown from Motherboard. Copper and cobalt comprise around 6 per cent and 5 per cent of the phone’s mass.
Credit profiles: A peek into who can absorb the shock?
According to S&P Global Ratings, many of Asia’s tech majors have diversified enough to keep the US supply flowing without heavy reliance on China. Lenovo’s US PC and smartphone sales make up 12–15 per cent of EBITDA. And, it would take a 30 per cent slump to hit downgrade triggers. Hon Hai (Foxconn) is expanding in Mexico, India, Vietnam and Europe to spread risk, with AI servers set to rebalance its revenue mix. TSMC’s 70 per cent US revenue exposure is buffered by its dominance in AI process technology, making profitability resilient even with concentrated capacity in Taiwan.
Not everyone has the same cushion. Samsung’s US premium smartphone sales could take a hit, and it still lags SK Hynix in high-margin AI memory. Kioxia’s heavy exposure to Apple and Dell leaves it with little rating headroom if tariffs bite. Renesas faces indirect pressure via auto-chip sales to the US, while Sony’s reliance on non-hardware earnings gives it more insulation.
The tariff shock is accelerating a once-slow realignment of tech manufacturing in Asia. Vietnam and India are the clear beneficiaries, for now. But with geopolitical trade winds shifting unpredictably, even today’s safe harbours could see the tide turn.
For aluminium and electronics markets alike, the lesson is the same, wherein resilience isn’t about where you stand today. It’s about how fast you can move when the ground shakes.
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