AI will greatly challenge product liability since it is based on assumptions as to physical objects distributed through organised linear value chains which do not necessarily apply in the AI context. AI systems further challenge both liability compartmentalisation based on separate risk spheres and the notion of defectiveness. The European Product Liability Regime is based on a linear value chain, whereas with AI, systems may be distributed differently. The realities of new value chains call for a number of adjustments to central product liability concepts, which will widen the scope of product liability rules. Further, AI may in fact have the potential to ultimately dissolve the very notion of product liability itself.