The Korean notebook PC contract manufacturing industry seems to be near the end of its lifespan, as several manufacturers are slowly seeing their most important customers leave. Samsung has been told that its largest customer Dell will stop giving orders to the company from the second half of 2006, and HP has ended its relationship with LG this year, while LG had already lost IBM at the end of 2004. Trigem filed for court receivership earlier this year due to its ailing ODM business.

 

Korean manufacturers have been able to manufacture high-end notebook PCs, but they have never been able to compete for the manufacturing of mid-range and value-line models. They have also been hurt by intense competition from Taiwanese makers, considerably slashing profit margins. It is expected that companies like Samsung and LG will instead step up efforts in their branded notebook businesses.