The establishment of Flextronics International Ltd’s laptop design center last month in Banciao (板橋), Taipei County, creates advantages for both the company and its customers, Sean Burke, president of Flextronics’ computing segment, said in a recent telephone interview.
The Singapore-based company decided to settle in Banciao because it is a prime location for the firm’s current and future employees in terms of proximity to MRT stations, retail stores and restaurants, Burke said. Also, with the new building, there would be room for expansion if needed, he said.
Most importantly, “this particular location is of the right cost structure. It’s close to the majority of experienced notebook engineers we intend to hire, as well as to many notebook component suppliers and partners we currently work with,” Burke told the Taipei Times.
Flextronics, one of the world’s leading electronics manufacturing services (EMS) providers, plans to hire up to 1,500 engineers over the next couple of years at the Banciao facility, which is aimed at providing design, research and support services for its clients.
The company, however, has no plans to “steal talents from other contract makers,” such as Quanta Computer Inc (廣達電腦), Compal Electronics Inc (仁寶電腦) or Hon Hai Precision Industry Co (鴻海精密), Burke said.
Already, the Singapore-based company has operations in Wugu (五股), Taipei County, and Jhongli (中壢), Taoyuan County. The new Banciao facilities expand Flextronics’ presence in Taiwan by adding an emphasis on the notebook computer sector.
“Flextronics has long recognized the importance of establishing a strong computing presence in Taiwan because it is the hub of many of the leading PC original equipment manufacturers [OEMs],” Burke said.
Flextronics, Hon Hai’s biggest rival in the EMS business, has made three acquisitions in the past three-and-a-half years, including the purchase of the PC and server manufacturing business of Arima Computer Corp (華宇電腦) for more than US$192 million in 2007 to strengthen its research and development (R&D) capabilities.
That acquisition alone bought Flextronics more than 600 Taipei-based R&D employees, Burke said, adding that the company’s strategy for completing its manufacturing chain was well thought out.
“We are strengthening and growing in what we’ve acquired. Similar to Hon Hai’s vertical integration, we are providing laptop components directly from inside the company, such as motherboards, printed circuit boards, touch pads, camera modules, power supply adapters, plastics and even metal,” Burke said.
Thus, Flextronics will be able to lower overall costs to its customers as well as provide products faster to market, he said.
Despite the decrease in information technology (IT) spending over the past nine months, Burke foresees a bright future for notebooks and netbooks as global consumers opt for mobility away from their desktops.
“We see stable demand in the second half due to seasonality in both commercial and consumer spending,” he said.
Moreover, as Intel Corp rolls out new processors that save energy and increase processing power, new demand will emerge because more companies will retire old equipment and data centers to embrace newer technology, he said.
Lately, Flextronics has heard a lot of discussion on alternative architecture, such as Linux or Google Inc’s Android operating system (OS).