Feeds

Toshiba's Chinese plans put pressure on Taiwan firms

Island government could ease local restrictions

  • alert
  • submit to reddit

Beginner's guide to SSL certificates

Toshiba's plan to manufacture notebook PCs in China will increase pressure on the government to let Taiwan's manufacturers follow suit, say industry observers. Foreign companies, such as Toshiba, order billions of dollars worth of notebook PCs from Taiwanese manufacturers every year. The Japanese company's new factory, near Shanghai, will take advantage of lower labor costs, and better access to the growing local market - both benefits that are denied to Taiwanese manufacturers by the island's own government.. Government restrictions on technology transfer and investment prevent Taiwan's notebook vendors from manufacturing in China. "I think increasingly the restrictions will be lifted, especially after the election next March" said Christine Lee, a notebook industry analyst at Merrill Lynch in Taipei. "We don't know if other foreign companies will also start manufacturing in China," commented Henry Wang of Acer, one of Taiwan's largest notebook makers, "it really depends on costs. Setting up a plant in China is expensive." He conceded that if initial ventures like Toshiba's were successful, others would follow. Analysts agreed with Wang that making notebooks in China may not be as simple as it seems. Taiwan, which makes almost half of the world's notebook PCs, has an established components supply chain. Key notebook components, such as LCD screens, are increasingly being made on the island. Christine Lee pointed out that initial production at Toshiba's Shanghai plant would be quite low, compared to Taiwanese manufacturers' output. The factory will produce about 110,000 notebooks next year, rising to 370,000 in 2004, according to Toshiba. Acer's planned output next year is 2.5 million, said Henry Wang. Toshiba, which has traditionally made its notebook PCs in house, has recently begun outsourcing some work to Compal of Taiwan. Compal executives did not return calls yesterday. According to Japanese press reports, Toshiba's Chinese factory will manufacture models from its full range of notebook computers, possible including products similar to those made by Compal. Set to begin operations next April, the Shanghai factory, situated in a high-technology park in the Pudong zone, is 90 percent owned by Toshiba or its subsidiaries. Taiwanese companies are making plans for the day when government restrictions are lifted. "If the government changes its policy, we may set up notebook production in China," predicted Henry Wang of Acer. One of Acer's competitors, Twinhead Corporation, has already built a notebook PC factory in mainland China. Currently it is making keyboards and other components, however a Twinhead executive said earlier this year that production lines could be switched to notebook production when regulations are changed. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
DOUBLE BONK: Testy fanbois catch Apple Pay picking pockets
Users wail as tapcash transactions are duplicated
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
New hybrid storage solutions
Tackling data challenges through emerging hybrid storage solutions that enable optimum database performance whilst managing costs and increasingly large data stores.