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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (520)	8/26/2003 11:59:15 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Quanta Helps China to Unseat Taiwan as No.1 Notebook PC Maker Aug. 27 (Bloomberg) -- Quanta Computer Inc. said it plans to more than double its production in Shanghai this year, helping China to unseat Taiwan as the world's largest manufacturing base for notebook computers. Taiwan-based Quanta, the world's largest notebook computer maker, is on course to produce about 10 million notebooks this year, of which 75 percent will be made in China, company Executive Vice President Michael Wang said in an interview. The company, whose biggest customers include Hewlett-Packard Co. and Dell Inc., is moving production to cut costs as its U.S. customers demand lower prices. Quanta is increasing manufacturing in China after completing a plant in Shanghai's Songjiang Industry Park, where labor, electricity, tax and government fees account for only 5 percent of total costs, Wang said. ``Taiwan's computer makers' profit margins are still under pressure as cheap manufacturing bases in China have caused overcapacity in the industry,'' said Phil Chen, who manages Grand Cathay Securities Investment Trust Co.'s $46 million High-Tech Fund. Chen said he planned to sell shares in Quanta yesterday. Lower prices are paring profit margins at Quanta and rivals such as Compal Electronics Inc., the world's No. 2 notebook maker. Quanta shares fell by the 7 percent daily limit to NT$82.50 in Taipei yesterday after the company said its gross profit margin, or the percentage of sales left after subtracting production costs, fell to 5.7 percent in the second quarter from 7.8 percent a year ago. Second-quarter profit rose 60 percent to NT$3.2 billion on a 95 percent rise in sales to NT$65.3 billion, the company said. Dell, the world's second-biggest PC vendor, last week slashed prices on some products by as much as 22 percent, a day after No. 1 Hewlett-Packard said the company's PC division lost money in the second quarter by cutting prices too deeply. quote.bloomberg.com