Mon, Nov 15, 2004 - Page 10 News List

Notebook makers up China output

SHANGHAI FOCUS Almost 90 percent of Taiwanese manufacturers have set up facilities in the region and are expanding their monthly production capabilities

CNA , TAIPEI

The monthly production volume of Taiwanese notebook-computer makers based in the greater Shang-hai area is expected to top 5 million units and hit 6 million next year, almost double the present level, industry sources said last week.

Currently, Taiwanese notebook makers operating in the Kunshan, Sungjiang and Pudung areas put out nearly 3 million units per month, making the greater Shang-hai area the world's most important area for notebooks.

As most of Taiwan's major notebook contractors have relocated to the greater Shanghai area, their profit margins are falling fast -- to less than 5 percent -- and a fierce war to grab customers is set to rage amid expanded production capacities, the sources said.

So far, some 90 percent of Taiwan's notebook manufacturers have set up at least a production plant in the three cities, with Kunshan luring the largest number and registering the highest level of output volume.

Quanta Computer Inc (廣達電腦), the nation's largest notebook company, enjoys a leadership role in Sungjiang with an output of 1.35 million units last month, accounting for 45 percent of the Taiwanese makers' total production volume and effectively widening the gap between it and other competitors.

Quanta is planning to build eight more plants in Sungjiang, six of which are completed and five of which have been designated for component assembly.

At the same time, Compal Electronics Co (仁寶電腦) forecast that its notebook export value contributed by its Kunshan division will reach around US$6 billion for this year.

A Compal executive was upbeat that the company will be able to put out 10 million notebooks for the whole of next year on the back of an increased monthly capacity of 1.2 million units. It is constructing a third manufacturing facility in Kunshan.

Inventec Corp (英業達) led other companies in opening its first facility in Pudung 10 years ago due to its convenient location close to Shanghai's new airport.

Inventec has plans to erect eight plants in Pudung, three of which are completed to boost its present notebook production level of 500,000 units to 1 million.

Following in Inventec's footsteps, ASUSTek Computer Inc (華碩電腦) has also shown a strong ambition to explore Pudung, having purchased 1,012 hectares of land there.

Should ASUSTek -- Taiwan's No. 1 motherboard manufacturer -- also use its Pudung land for notebook production, the city stands a very real chance of rivaling Kunshan and Sungjiang in terms of production volume.

In the face of the expanded capacities of notebook makers in the Shanghai area, none of them have shown signs of wanting to retreat from the race, sources pointed out, adding that their main strategy now is to further squeeze their earnings to seize more business opportunities.

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