Shipping problems encountered by brand-name notebook PC vendors and their Taiwanese suppliers in China may soon be relieved, as Federal Express formally announced the opening of its China regional headquarters in Shanghai this week. In addition, the Chinese government approved FedEx's request to more than double its number of cargo flights leaving from Shanghai's Pudong airport to 23 per week.

 

FedEx has also applied for permission to open six weekly cargo flights that will depart from Guangdong Baiyun International Airport starting in 2006. FedEx hopes to bring Guangdong into its Asia-Pacific express delivery network, which would be a welcome development for the numerous Taiwanese IT players with production facilities in the province. 

 

Since the fourth quarter of 2002, NB PC makers have had an increasingly difficult time finding sufficient space to ship their cargo, causing significant delays. In the fourth quarter of 2003, Acer decided to postpone notebook PC production plans that it had scheduled for China due to shipping problems.

 

Previously, notebook PC makers with factories in China were often forced to resort to expensive measures to meet shipping deadlines. Many would purchase large quantities of shipping space months ahead of time, which would be wasted if shipping demand felt short of estimates. Some would first ship goods by land to Nanjing, where they would be transferred to cargo flights. Others would send goods through Hong Kong or the Philippines before shipping them on to their final destinations. Such shipping methods added considerably to production costs.