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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Math Junkie who wrote (44807)	3/30/2001 2:44:13 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

China handset market still booming By Jack Robertson EBN (03/30/01 09:16 a.m. PST) BEIJING -- Cell phone makers in China aren't suffering from the glut of excess inventory afflicting the rest of the world, according to parts exhibitors at the International IC Show held here this week. Manufacturers selling to the booming Chinese wireless market have seen little slowdown in sales and are continuing to order parts normally, suppliers said. Wayne Chao, chairman of Avnet Inc.'s China ECNet Co. Internet e-commerce operation, said cell phone purchases in China are on track to triple in the next two years, reaching 200 million subscribers in 2003. “Unlike the U.S. and Europe, where the cellular market has slowed down, Chinese manufacturers can sell all the units they can build. That means there is little inventory buildup in the supply channel for domestic firms,” Chao said. A little oversupply exists in commodity general-purpose analog chips, but stocks are normal for application-specific devices, operational amplifiers, and chipsets, said Gong Gao, chief engineer and veteran domestic industry expert at distributor Beijing Incel Components Group. “It's because the China cell phone market remains very strong and manufacturers never had a chance to accumulate excess inventory,” he said. Purchase orders from wireless handset companies in China are following traditional quarterly patterns and are picking up steam heading into the next quarter, according to Paul Ho, sales manager of the InSight division of Memec (Asia Pacific) Ltd., Hong Kong. The value-added parts largely handled by InSight Asia are not subjected to the wide inventory swings of commodity parts, Ho said. “It's commodity parts that are in heavy oversupply in the rest of the world,” he said. Jerry Gao, North China sales manager at Microchip Technology Inc.'s Beijing office, said the company's sales to China cell phone makers grew 50% last year. “This year the growth rate may be a few percentage points under that, but still very strong,” he said. Chinese customers are quickly putting fresh parts into production, unlike many regions of the world where booming sales last year ended up in excess inventory when the market slumped, Gao added. Tony Lam, Infineon AG's product marketing engineer, Hong Kong, noted that the Chinese government requires a large portion of local-content parts in cell phones. Domestic makers of passives, discretes, and routine parts have a ready market for their products, while foreign parts fighting to break through the local-content barrier have little chance to wind up in excess stock, he said. Some domestic cell phone companies earlier this year eased off on taking orders in a seasonal purchasing pattern, said David Ho, product engineer at Fairchild Semiconductor's Asia-Pacific division in Hong Kong. He said the strong Chinese cell phone market, however, is not slowing and sales are back on track.