TSMC put a number on this when it told investors that running fabs outside Taiwan will reduce gross margin by two-to-three percentage points, widening to three-to-four percentage points as those plants scale.

Most firms would have no cushion. A majority of contract manufacturers work on thin gross margins; when their costs rise, the money most likely needs to come from the customer’s price.

As technology buyers, companies need to start preparing for a world of higher prices — but none of this means the reorientation was a mistake.

A supply chain running through a single strait, a handful of foundries and a short list of tool vendors was a real risk. No business or political leader who lived through 2020 and 2021 was going to sit on their hands, especially as the boom in the promise of AI has provided more pressure on supply chains.

So, what has all this change provided? So far, it’s been an evolution of movement more so than resiliency.

Final assembly relocated because final assembly was always the least expensive thing to move. The layers of concentration that actually constrain the industry — fabrication, advanced packaging and the specialized components that carry their own supplier networks behind them — have barely shifted.

When governments do move them, it’s predominantly through large incentives that have mixed results. The US and China, the world’s two economic superpowers, are now funding separate systems built to avoid depending on each other — and neither is less concentrated and less fragile than before.

Meanwhile, companies suffer from increased supply chain complexity that’s accompanied by increased prices.

The deeper issues remain ingrained in the system — and those in the tech industry should stop mistaking a redrawn map for a rebuilt supply chain.