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Foxconn's Polish gamble

by on04 December 2009

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Buying Dell plant unlikely to boost notebook shipments


Analysts
wonder what Foxconn was smoking when it decided to buy Dell's PC plant in Poland. Initially it was thought that Foxconn might use the plant to give it a foothold in Europe but now analysts think that it is unlikely.

The plant cannot significantly produce notebook output for Foxconn, in fact it makes very few of the beasts. Foxconn is weak in R&D and purchasing a purely manufacturing plant will not benefit the company much. Neither will the acquisition impact the current outsourcing plans of first-tier notebook makers for 2010 since Foxconn's new orders are from Dell's in-house production.

Dell's in-house notebook production lines are mainly located at its plants in Malaysia while the Poland plant is mainly used for desktop production with a very small volume of notebook manufacturing. However some of the bean counters have speculated that Foxconn might have another cunning plan. Its big idea might be that it wants Dell to increase its outsourcing to Foxconn in the long run.

Currently Foxconn makes notebooks for Dell, Hewlett-Packard (HP), Apple and Sony with an estimated shipments of 3-4 million notebooks in 2009, and forecast shipments of six million units for 2010.
Last modified on 04 December 2009
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