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According to reports from Chinese press, such as Commercial Times, Economic Daily News and DigiTimes, Gigabyte Technology and Foxconn Electronics have reached a strategic agreement under which the latter would make mainboards for the former. The move may be an indicator of an alliance aimed against ASUSTeK Computer.

Foxconn is likely to produce entry-level mainboards for Gigabyte Technology. Gigabyte confirmed DigiTimes it had already outsourced some production to Foxconn, however it denied the existence of a strategic agreement between the companies. The Gigabyte-Foxconn partnership may be aimed at the industry leader ASUSTeK Computer, which had reportedly set a plan, dubbed “Giant Lion,” to boost its mainboard shipments to 45 million units in 2004 from 30 million in 2003.

Gigabyte shipped about 13.77 million mainboards last year, Foxconn shipped 26 million mainboards in 2003. Gigabyte expects its mainboard supplies to grow at least 10% to 15.15 million units in 2004. Foxconn is also pretty optimistic in regards its shipments increases and plans to sell 34 million mainboards this year.

In late January 2004 Gigabyte was rumored to establish a subsidiary called Gigatrend to sell cost-effective products. However, the firm now uses its own brand-name to sell “RZ” – its mainboards for entry-level PCs.

Foxconn produces components for HP, Dell, Intel as well as Taiwan-based companies like CP Technology and LeadTek Research.

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