Business

Acer has big plans for Chongqing

By Tuo Yannan (China Daily)
Updated: 2010-12-02 07:56

Gianfranco Lanci (third from left), chief executive officer of Acer Inc, shakes hands with Huang Qifan, mayor of Chongqing, at a ceremony on Wednesday to mark the company's $150 million investment in the city. [Nelson Ching / Bloomberg]

CHONGQING - Acer Inc will invest $150 million in the southwestern city of Chongqing to build its biggest global IT manufacturing center and set up its second base in the mainland.

"Within three years, China will surpass the US to become the world's biggest computer market," said Acer Chief Executive Officer Gianfranco Lanci at the signing ceremony between Acer and the Chongqing municipal government on Wednesday.

In addition to the $150 million investment, Lanci said the company will continue to invest in the mainland to enhance Acer's presence in the local market and boost the company's global competitiveness.

He pointed out that the world's second-largest computer maker is aiming to become the second-largest PC company in the mainland, following Lenovo Group Ltd.

"Our growth rate in the notebook sector in China is about 20 to 25 percent year-on-year," Lanci said.

According to IDC, a market research company, Taiwan-based Acer ranked sixth in the mainland, with a second quarter market share of 3.6 percent, while Lenovo had 28.7 percent.

"In the short term, it is very hard for Acer to outperform Lenovo and Dell in the mainland market," said Wang Jiping, research manager at IDC China. "Its rivals are Taiwan-based Asus, which accounts for 5 percent of the market share in the mainland, and HP, which has 8.2 percent."

Wang said China's PC output will surpass the United States by 2013. After Acer cooperated with PC maker Founder, its market share increased to about 10 percent in the mainland.

"It is a wise decision for the company to establish a factory in Chongqing, due to its lower costs and more skilled labor force," Wang said.

Acer said 90 percent of its Chongqing manufacturing center's output will be shipped to be sold in other markets. Lanci said the new factory will produce more than 40 million units annually.

According to Lanci, the company will launch its tablet PC in the first quarter of next year.

"Most of our tablet PCs and smartphones will be produced in China, and smartphone production will reach 500 million units within three to five years," Lanci said.

China Daily