Inventec Corp’s (英業達) board of directors has approved a plan to spend NT$2 billion (US$64.5 million) to move part of its laptop production back to Taiwan to avoid US tariffs on China-made goods, the contract electronics maker said yesterday.
It is part of a broader production capacity reallocation plan by the company to minimize operating risks from the US-China trade dispute, which has triggered large-scale production moves from China not only by Inventec, but also its Taiwanese peers Compal Electronics Inc (仁寶電腦) and Quanta Computer Inc (廣達電腦).
The bulk of Inventec’s latest investment would be used to expand the capacity of its laptop manufacturing site in Taoyuan’s Dasi District (大溪), a public relations officer said by telephone.
Inventec president Maurice Wu (巫永財) told investors last month that the company planned to shift its entire US-bound laptop operation to Taiwan by the end of this year to circumvent Washington’s 15 percent tariffs.
Laptops were Inventec’s biggest source of revenue last quarter, contributing between 40 percent and 45 percent to total sales, the company’s financial statement showed.
Geographically, the US accounted for between 25 and 30 percent of Inventec’s laptop sales, the official said.
The company, which makes laptops primarily for HP Inc, began shipping products from Taiwan earlier this year, as the US plans to add computers to a 10 percent tariff list, which is to take effect on Dec. 15.
From this month, smartphones, servers, networking devices and other consumer electronics exported from China are subject to a 25 percent US levy.
Invectec plans to use its cash flow and profit generated at overseas subsidiaries to fund capital spending for this year and next year, it said.
The company has shifted almost all US-bound server production to another manufacturing site in Taoyuan’s Gueishan District (龜山) and is in the process of relocating production of smart devices from Shanghai and Nanchang in China to its Malaysian factories.
The company also makes AirPods for Apple Inc, and smartphones for Xiaomi Corp (小米) and Huawei Technology Inc (華為), with the US being one of its major export destinations.
Smart devices account for between 15 and 20 percent of the company’s revenue.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
PROJECTION: TSMC said it expects strong growth this year, with revenue in US dollars projected to grow by about 30 percent, outperforming the industry Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported consolidated sales last month reached NT$317.66 billion (US$9.98 billion), the highest ever for the month of February, driven by robust demand for chips built using the company’s advanced 3-nanometer (3nm) process. Last month’s figure was up 22.2 percent from a year earlier, but fell 20.8 percent from January, the world’s largest contract chipmaker said in a statement. For the first two months of the year, TSMC posted cumulative sales of NT$718.91 billion, up 29.9 percent from a year earlier. Analysts attributed the growth to sustained global demand for artificial intelligence (AI) products
RSS