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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (138751)	8/9/1999 7:55:00 PM
From: TechMkt	Respond to of 176387

DELL consumer laptops to be assembled in U.S. Fez ___________________________ August 09, 1999, Issue: 1172 Section: News North America gaining rep as PC assembly site Jack Robertson Notebook-PC makers are shifting final assembly operations to North America in a major attempt to shorten the supply chain, but are still relying heavily on Asia's contract assemblers for certain models. The move is part of an ongoing corporate decentralization aimed at moving products closer to their final OEM destination, and is affecting PC manufacturers differently, according to several companies involved in their own relocation efforts. A spokesman for Dell Computer Corp., for example, said the company is moving assembly operations for its consumer notebooks from Asian contract manufacturers back to Dell's home plant in Austin, Texas. "We need much quicker turn-around in notebook assembly to cut inventory, shorten delivery times, and react faster to market changes," the spokesman said. Consumer-notebook profit margins are so slim that any savings realized by shortening the supply chain are a major profit driver, the company said. But while it will relocate consumer-laptop assembly to the United States, Dell said it will continue to assemble its notebook PCs for the corporate market in several Asian locales, including China, Malaysia, and Taiwan. "Product life cycles are much longer in the corporate market, and the need to react quickly to market changes is not as great," the spokesman said. IBM Corp.'s Mobile Computing Division, Raleigh, N.C., is also moving more of its notebook assembly operations out of Asia. By next year, 65% of all IBM portable PCs will be assembled in Guadalajara, Mexico, up from about half this year. Ken Czarnecki, director of OEM operations for the IBM group, said the company's strategy is to assemble high-end models in North America, and leave low-end notebook assembly to Asian subcontractors. Unlike Dell, IBM believes high-end notebooks stand to benefit most by pulling assembly into North America. Czarnecki said the sheer number of features and rapid design cycles at the market's high end demand that IBM assemble its machines closer to big U.S. customers. "We can get just-in-time delivery of parts much easier and can cut our inventory needs," he said.