Feeds

Lenovo ups in-house notebook production

It's all about control...

Secure remote control for conventional and virtual desktops

It could be sweaty palm time for Taiwan’s ODMs after reports emerged that Lenovo is set to step up in-house production of its notebooks and PCs.

The Chinese hardware giant is planning new production lines in Japan and Brazil as well as at its LCFC joint venture with Compal Electronics in northern China, Digitimes reported.

Industry sources told the Taiwan-based IT paper that LCFC would begin production of 300,000 PCs per month by the end of the year, building to an annual target of 10 million.

The move is apparently drive by a desire to control component supplies in a more flexible manner, keep production costs down and tighten control over shipment schedules. At the moment, around 85 per cent of its notebooks are outsourced, mainly to Compal and Wistron.

Having greater control over the production of its kit would appear to make sense for Lenovo, especially given the caution in the global PC market at the moment.

Gartner’s latest sales stats for Q2 showed a year-on-year decline in the US of 5.7 per cent, while EMEA sales grew 1.9 per cent and Asia Pacific climbed 2 per cent.

Despite closing in on HP’s position as global number one, Lenovo has to beware of producing more inventory than the market is demanding, a trap that Acer fell into last year to its cost, according to Gartner.

It remains to be seen whether Lenovo’s decision will hugely impact the health of Taiwan’s ODM industry, which accounts for around 90 per cent of the world's notebooks.

Although the firm shifted 12.8m units in Q2, increasing its market share to 14.7 per cent, there are obviously plenty more fish in the sea.

In fact, if Lenovo is to bring more of its production in-house, it would be travelling in the opposite strategic direction to Samsung, which has begun outsourcing notebook production for the first time – Compal again the lucky ODM.

Lenovo could not immediately be reached for comment. ®

The essential guide to IT transformation

More from The Register

next story
Apple's iWatch? They cannae do it ... they don't have the POWER
Analyst predicts fanbois will have to wait until next year
The agony and ecstasy of SteamOS: WHERE ARE MY GAMES?
And yes it does need a fat HDD (or SSD, it's cool with either)
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Apple to build WORLD'S BIGGEST iStore in Dubai
It's not the size of your shiny-shiny...
Just in case? Unverified 'supersize me' iPhone 6 pics in sneak leak peek
Is bigger necessarily better for the fruity firm's flagship phone?
Steve Jobs had BETTER BALLS than Atari, says Apple mouse designer
Xerox? Pff, not even in the same league as His Jobsiness
Apple analyst: fruity firm set to shift 75 million iPhones
We'll have some of whatever he's having please
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?