Mon, May 12, 2008 - Page 12 News List

Laptop shipments set to increase 22%

RARE RECOVERYDesktop computer replacement and strong demand from emerging markets such as China are considered the major drivers behind the shipment trend

By Lisa Wang  /  STAFF REPORTER

Taiwanese notebook computer makers led by Quanta Computer Inc (廣達電腦) are expected to ship 22 percent more laptops this year, thanks to strong demand from emerging markets and continued replacement of desktop computers, a Taipei-based researcher forecast.

Local contract manufacturers, who supply laptops to the world’s major PC brands including Hewlett Packard Co, Dell Inc and Acer Inc, may ship 110 million notebook computers this year, compared to about 90 million units last year, the Market Intelligence Center (MIC, 資訊市場情報中心) projected. The forecast does not include low-cost laptops.

“Constant desktop replacement demand and new consumer demand in emerging markets such as China are major drivers,” said Nicole Huang (黃怡瑄), who tracks the notebook computer industry for MIC.

The nation’s two biggest notebook computer contract makers, Quanta and Compal Electronics Co (仁寶電腦), recently projected shipments would expand to a combined 72 million units this year.

Wistron Co (緯創), the third-largest contract maker, plans to ship 20 million units this year, with demand mainly coming from Asian and European countries, the company said at the Citi Taiwan Investor Conference 2008 last week.

Apart from an increase in shipments, the average selling prices (ASPs) are expected to show a rare recovery from the second quarter to the fourth quarter, the MIC analyst said.

In the first quarter, ASPs dropped at a slower pace to US$512 per unit from US$553 a year ago, the MIC’s tallies showed.

Huang attributed the rising ASPs to rising labor costs in China, where the major manufacturing center for local firms is located, and mounting component costs because of hikes in global commodity prices.

She also said the appreciating NT dollar against the US dollar put local manufacturers under greater pressure.

“Local laptop contract makers are discussing price hikes with their customers, which is unavoidable,” Huang said.

Compal, which supplies laptops to Dell Inc and other major PC vendors, said earlier this month that it was in talks with customers to raise prices to better reflect rising costs.

During a quarterly investor conference held on Tuesday, the company said it might reach an agreement sometime this quarter, at the earliest.

The price increase would be the first in its history, the company said.

Labor costs in China increased 25 percent this year from the past five years after new labor rules took effect and the price of copper rose 80 percent year on year, Compal said.

In the first three months of the year, local laptop contract makers shipped 25 million laptops, up 35 percent from 18.5 million units a year ago, as robust demand in developing countries has partly offset the weak demand in the US stemming from the subprime mortgage problem, MIC said.

Total revenues generated by local manufacturers grew 26.9 percent year on year to US$12.99 billion in the first quarter as PC vendors launched new high-end models, the researcher said.

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