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Following the trend to make personal computers cheaper, virtually all manufacturing operations have been transferred to Asia. Countries like China, Taiwan, Hong-Kong, Singapore, Philippines and South Korea produce the vast majority of components for PCs. Furhermore, leading notebook makers continue to rapidly transfer all their assembly and even some engineering operations to Asia, moreover, nowadays they seek for the cheapest offerings from local companies.

Taiwanese manufacturers produced 58% of all mobile PCs in 2001, 65% in 2002, according to iSuppli. If the trend continues, this year more than 70% of all notebooks will be made in Taiwan. Next year the share may skyrocket to mid- or high-eighties, as the world’s largest notebook manufacturers – Quanta and Compal Electronics who shipped 5.4 million and 4.1 million of notebooks in 2002 respectively – land more and more orders from brand-name PC companies who expect the market of notebooks to grow significantly next year.

Several Taiwan-based mobile computer makers are projected to ship 700 to 800 thousands of notebooks during the first half of 2004. In the second half of 2005 and in the first half of 2005 HP will outsource an even more substantial part of its mobile computer production to four partners from Taiwan, DigiTimes reported. Inventec will produce two mainstream business models with monthly shipments of 100 to 150 thousands units. Quanta will be ordered 17” and 15.4” wide-screen notebooks, a slim 12.1” notebook and a standard 14.1”/15” model. Wistron is expected to manufacture a 15” SOHO mobile PC. Compal has landed orders on a 12.1” Tablet PC. Monthly shipments from all these companies in 2H 2004 and 1H 2005 are projected to reach 200 – 250 thousands of units.

Toshiba is also considering increasing the share of products outsourced to Taiwanese makers from 30% this year to 50% or more in 2004. Currently, Toshiba has two Taiwanese suppliers, Compal Electronics and Inventec, but is very likely to ink contracts with one more partner. Next year the company plans to sell 6 – 7 million notebooks in the global market. With 50% of those machines made in Taiwan, mobile PC makers Compal Electronics and Inventec should be very pleased with the orders next year.

The world’s second largest notebook maker Dell also outsources the vast majority of its mobile computers to Taiwanese companies. So does Apple Computer, who sells quite expensive products, so do Sharp, Gateway and loads of other leading notebook suppliers. What is even more interesting to note is that even Chinese largest notebook maker Legend has outsourced some of its mobile PCs to Taiwanese partners.

Amid experiencing an extraordinary success with notebooks, Taiwanese companies are heavily investing in handset production these days. A lot of cell-phone assembly factories will be located in China.


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