Asus to begin outsourcing some notebook production
Since shipments of notebooks failed to meet expectations in the first half of 2008, Asustek Computer has said meeting its annual shipments target will be hard. In order to shrink production costs, the company plans to bring forward outsourcing of notebooks, including Eee PCs, to the fourth quarter of 2008.
During an August 6 investors conference, Asustek president Jerry Shen explained the weaker-than-expected second-quarter sales to a decline in notebook shipments. The earthquake and weak stock market in China led to a sharp erosion of consumption in the second quarter. Consumption in Europe was also low due to the ongoing weak economy, he said.
Demand for notebooks in China and Europe has resumed in July and August with monthly shipments to each region posting sequential growth from July, Shen said. He anticipated that sales should grow progressively onward. Commenting on notebook sales trends in the US, Shen said growth is still anticipated due to promotions with retailer Best Buy and growing adoption of Eee PCs.