Dell gets permit for second Austin plant
Courtesy Bhart of the dellinvestors club....
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Move demonstrates company's confidence in future PC sales
By Jerry Mahoney
American-Statesman Staff
Published: March 25, 1999
ROUND ROCK -- In the latest signal that it remains bullish about its prospects, Dell Computer Corp. has taken out a building permit for a
second assembly facility at its 570-acre campus in North Austin.
Last fall, Dell opened a nearly 300,000-square-foot plant at the site, which is about a mile east of Interstate 35 on Howard Lane.
According to city records, that building and its contents have a valuation of $28.9 million. Dell told city officials last year that the campus
may one day contain as many as 10 buildings employing 12,000 workers.
The new building, according to the permit taken out earlier this month, would be about 10,000 square feet larger.
A Dell spokeswoman declined on Wednesday to discuss plans for the campus, saying that the new permit allows the company to move
quickly when it decides another facility is needed.
In February, Dell officials met with a small group of area residents at Our Savior Lutheran Church near Dessau Road and Yager Lane to
brief them on the company's plans, said Janet Klotz, president of the North Growth Corridor Alliance, an organization of neighborhood
groups.
"This one is definitely for manufacturing," Klotz said, adding the officials said Dell may put office buildings on the site later.
Dell is by far the fastest-growing major PC maker, despite a slowdown in the rate of growth in its fourth quarter that ended Jan. 29. The
company's revenue growth of 38 percent from a year earlier snapped a string of several quarters of growth above 50 percent and seems to
have cooled some investor enthusiasm for Dell stock.
Dell shares closed Wednesday at $38.50, up $2.81 1/4, on the Nasdaq market. Dell shares have fallen nearly 25 percent since
mid-February on a split-adjusted basis. Concerns about near-term revenue in the technology sector overall are blamed for some of the
market's lackluster performance recently.
Nonetheless, Dell continues its course of expansion, driven by the company's belief that it can grow several times faster than the PC
industry average. Part of that confidence stems from the fact that Dell has only a small presence in major markets such as China and South
America.
Dell opened a facility in Xiamen, China, last August. It is expected to open a third plant in Ireland and its first facility in Brazil this year. The
Northeast Austin plant that opened last fall assembles powerful computers known as servers and workstations for customers in North and
South America.
In addition, Dell is adding two office buildings in Round Rock, where its corporate offices, sales and support for the Americas are.
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