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Taiwan's laptop firms face tough year

TAIWANESE contract computer makers are expected to equal last year's production of 110 million laptops in 2009, but earn as much as 5 percent less in total revenues, a market research organization said yesterday.

Total revenue for the contract makers reached an estimated US$57.3 billion in 2008, the semiofficial Taiwanese Institute for Information Industry said.

However, it said the figure could drop between 3 percent and 5 percent this year as makers cut prices because of the global economic downturn.

Taiwanese contract makers produce 90 percent of the world's laptops.

They produce laptops for leading foreign makers, such as Dell, Hewlett-Packard, Sony and Toshiba, as well as Taiwanese computer firms including Acer Inc. The makers use their extensive assembly lines in Chinese mainland to cut production costs.

"It will be a tough year for the Taiwanese contract makers," said Wei Chuan-chian, an analyst with the institute. "Computer firms from Japan to the United States have turned conservative amid the recession."

Quanta Computer Inc, the world's largest contract laptop maker, is expected to churn out more computers for industrial use as its customized products render higher profit margins, Wei said.

The makers will also produce low-cost laptops, known as netbooks, to keep their assembly lines busy, he said.

The institute's figures do not include netbooks.

Total netbook output is expected to reach 22 million this year, double the 2008 total, the institute predicted.

With relative scant memory, netbooks are built largely to access the Internet or allow users to check e-mails.



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