Acer Communications & Multi-media Inc (
China sales of Acer-brand products, excluding products made under contract for other companies, comprised almost a third of global sales last year, Michael Tseng, managing director of Acer Communication's China business, said in an interview. That proportion is expected to rise to half by 2004.
The Acer unit is benefiting from booming computer popularity in the world's largest market. Computer sales this year are expected to rise by about a third to 9.5 million units, according to statistics by IDC research.
"We regard China as our home market; not Taiwan, where the market is too small," Tseng said.
China's economy is expected to grow up to 8 percent this year, while doubts remain about Taiwan's 5.3 percent growth target.
Acer has invested US$116 million in China, where it operates three factories in the Suzhou New Industrial Park (
Tseng said the China business has been ``profitable for four years,'' though he declined to give figures. Acer Communications' customers include Legend Holdings Ltd (
Thought it's the largest mobile phone maker in Taiwan, Acer Communications is barred by the Taiwan government from making cellular phones on the mainland. It doesn't have a license to sell cellphones in China yet, Tseng said.
Taiwan companies "will die if they don't move over here," he said. Rising labor and production costs in Taiwan make goods produced here less competitive compared with the mainland, Tseng said.
``It costs five times as much to turn a screw in Taiwan than it does in China,'' he said.
A growing number of companies from all business sectors have be fleeing to China, despite Taiwan's highly restrictive rules, in an effort to boost competitiveness.
Acer Communications shares rose as much as NT$2.70, or 6.9 percent, to NT$41.80 on the Taiwan Stock Exchange.
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