TAIPEI, Feb 18 (Reuters) - Taiwan's Compal Electronics (2324.TW: Quote, Profile, Research), the world's second largest contract laptop PC maker, expects monthly shipments from Vietnam to reach up to 1 million units by the end of 2009, as it aims to make half of its computers there by 2013.
Compal currently makes nearly all of its computers at a complex near Shanghai, where costs have been growing amid rising living standards, and a new labour law that went into effect in January is expected to push up costs even further.
"We expect to move half of our production to Vietnam by 2013, but the process takes time, since most of the supply chain is still in China," Chang Chih-ming, an investor relations manager, told Reuters on Monday while also providing the 2009 monthly target.
The build-up for 2009, which would give the company capacity to ship up to 12 million units annually by year-end, compares with Compal's target to ship a total of 32 million units this year.
Some analysts said Compal's decision came as little surprise.
"They have no choice but to do this, because their China plant has no further room to expand," said JP Morgan analyst Alvin Kwock, adding that the monthly shipment targets were in line with analyst expectations.
Compal told investors last year that it planned to invest about $500 million to expand and move some manufacturing facilities to Vietnam as costs in China grew. Continued...
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