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The Greater Chinese Notebook PC Industry, 2002 and Beyond

March 07, 2003 / Charles Chou

63 Page, Statistics Report

US$1,990 (Single User License)

Abstract

With leading Japanese notebook PC vendors increasingly outsourcing production to manufacturers in the Greater China region, Greater Chinese share of total global notebook PC shipment volume rose to 61% in 2002. Gaining steadily every quarter, Greater Chinese notebook PC industry shipment volume grew by 30% in 2002 over 2001. Greater Chinese notebook PC manufacturers, while steadily looking for new ways to reduce costs, have been ceding to pressure from leading international notebook PC vendors to develop production facilities close to the Chinese market. By the fourth quarter of 2002, with 50% of Greater Chinese notebook PC industry production taking place in China, ASP fell to US$710. China has replaced Taiwan as the industry's leading production center. The possible development of a clone market will have a major impact on the future condition of the overall notebook PC market, affecting both leading brand-name player competition and ODM/OEM production. In addition to a review of 2002, the following report will explore the formation and impact of such a notebook PC clone market, and provide short and long-term forecasts of the Greater Chinese notebook PC industry.

List of Topics
Five year shipment volume, value, and desktop replacement forecast as well as quarterly Tablet PC and aggregate volume forecast through 2003. Review of fourth quarter 2002 Greater Chinese shipment volume, value, ASP, business types, product architecture, assembly locations, shipment destinations by form factor. Analysis of the formation of the notebook PC clone market, impact of Tablet PCs, and Intel strategies, as well as major player ranking, profiles, and coverage of Greater Chinese operations in China.

Acer, AMD, Apple, Arima , Asus, Compal, Dell, ECS, FIC, Fujitsu-Siemens, Gericom, HP, IBM, Intel, Inventec, Legend, LG, Maxdata, Medion, Microsoft, Mitac, NEC, Quanta, Samsung, Sharp, Sony, Toshiba, Transmeta, Uniwill, Wistron

List of Figures
Figure 1 The Greater Chinese Notebook PC Industry's Shipment Volume, Shipment Value, and ASP 1Q 2001 - 4Q 2002

Figure 2 Notebook PC Production Migration, 1998-2002

Figure 3 The Greater Chinese Notebook PC Industry's Shipment Volume by Tier, 1Q 2001 - 4Q 2002

Figure 4 The Greater Chinese Notebook PC Industry Shipment Value by Tier, 1Q 2001 - 4Q 2002

Figure 5 The Greater Chinese Notebook PC Industry's ASP by Tier, 1Q 2001 - 4Q 2002

Figure 6 The Greater Chinese Notebook PC Industry's Shipment Price Points, 1Q 2001 - 4Q 2002

Figure 7 The Greater Chinese Notebook PC Industry's Shipment Share by Price Points, 1Q 2001 - 4Q 2002

Figure 8 The Greater Chinese Notebook PC Industry's First Tier Makers' Shipment Price Points, 1Q 2001 - 4Q 2002

Figure 9 The Greater Chinese Notebook PC Industry's First Tier Makers' Shipment Share by Price Points, 1Q 2001 - 4Q 2002

Figure 10 The Greater Chinese Notebook PC Industry's Second Tier Makers' Shipment Price Points, 1Q 2001 - 4Q 2002

Figure 11 The Greater Chinese Notebook PC Industry's Second Tier Makers' Shipment Share by Price Points, 1Q 2001 - 4Q 2002

Figure 12 The Greater Chinese Notebook PC Industry's Full System and Barebone Shipment Value, 1Q 2002 - 4Q 2002

Figure 13 The Greater Chinese Notebook PC Industry's Full System and Barebone Shipment Volume by Tier, 1Q 2002 - 4Q 2002

Figure 14 The Greater Chinese Notebook PC Industry's Full System and Barebone Shipment Volume Share by Tier, 1Q 2002 - 4Q 2002

Figure 15 The Greater Chinese Notebook PC Industry's Shipment Volume by Business Type, 1Q 2001 - 4Q 2002

Figure 16 The Greater Chinese Notebook PC Industry's First Tier Makers' Shipment Volume by Business Type, 1Q 2001 - 4Q 2002

Figure 17 The Greater Chinese Notebook PC Industry's Second Tier Makers' Shipment Volume by Business Type, 1Q 2001 - 4Q 2002

Figure 18 The Greater Chinese Notebook PC Industry's Shipment Volume by Destination Area, 1Q 2001 - 4Q 2002

Figure 19 The Greater Chinese Notebook PC Industry's Shipment Share by Destination Area, 1Q 2001 - 4Q 2002

Figure 20 The Greater Chinese Notebook PC Industry's First Tier Makers' Shipment Volume by Destination, 1Q 2001 - 4Q 2002

Figure 21 The Greater Chinese Notebook PC Industry's First Tier Makers' Shipment Share by Destination, 1Q 2001 - 4Q 2002

Figure 22 The Greater Chinese Notebook PC Industry's Second Tier Makers' Shipment Volume by Destination, 1Q 2001 - 4Q 2002

Figure 23 The Greater Chinese Notebook PC Industry's Second Tier Makers' Shipment Share by Destination, 1Q 2001 - 4Q 2002

Figure 24 The Greater Chinese Notebook PC Industry's Product Mix, 1Q 2001 - 4Q 2002

Figure 25 The Greater Chinese Notebook PC Industry's Product Mix Percentage, 1Q 2001 - 4Q 2002

Figure 26 The Greater Chinese Notebook PC Industry's First Tier Makers' Product Mix, 1Q 2001 - 4Q 2002

Figure 27 The Greater Chinese Notebook PC Industry's First Tier Makers' Product Mix by Percentage, 1Q 2001 - 4Q 2002

Figure 28 The Greater Chinese Notebook PC Industry's Second Tier Makers' Product Mix, 1Q 2001 - 3Q 2002

Figure 29 The Greater Chinese Notebook PC Industry's Second Tier Makers' Product Mix by Percentage, 1Q 2001 - 4Q 2002

Figure 30 The Greater Chinese Notebook PC Industry's Displays by Screen Size, 1Q 2001 - 4Q 2002

Figure 31 The Greater Chinese Notebook PC Industry's Screen Size Ratios, 1Q 2001 - 4Q 2002

Figure 32 The Greater Chinese Notebook PC Industry's First Tier Makers' Displays by Screen Size, 1Q 2001 - 4Q 2002

Figure 33 The Greater Chinese Notebook PC Industry's First Tier Makers' Screen Size by Percentage, 1Q 2001 - 4Q 2002

Figure 34 The Greater Chinese Notebook PC Industry's Second Tier Makers' Displays by Screen Size, 1Q 2001 - 4Q 2002

Figure 35 The Greater Chinese Notebook PC Industry's Second Tier Makers' Screen Size by Percentage, 1Q 2001 - 4Q 2002

Figure 36 The Greater Chinese Notebook PC Industry's Shipment Volume by Production Site, 1Q 2002 - 4Q 2002

Figure 37 The Greater Chinese Notebook PC Industry's Shipment Volume, Shipment Value, and ASP, 1Q 2003 - 4Q 2003

Figure 38 The Greater Chinese Notebook PC Industry's Shipment Volume, Shipment Value, and ASP, Scenario One

Figure 39 The Greater Chinese Notebook PC Industry's Shipment Volume, Shipment Value, and ASP, Scenario Two

Figure 40 Worldwide Tablet PC Shipment Volume, 4Q 2002 - 4Q 2003

Figure 41 Worldwide Industry Shipment Volume by Type and Growth Rate 1998 - 2007

List of Tables
Table 1 Major Greater Chinese Notebook PC Manufacturer Ranking by Tier, 1Q 2002 - 4Q 2002

Table 2 Major Greater Chinese Notebook PC Manufacturer Ranking by Tier, 1999 - 2002

Vendors will be developing products to target specific segments of the market. Owing to the failure to achieve significant improvement in the Pentium 4-M's processing speed or heat dissipation capabilities, and the steady increase in DTS notebook PC market share, mainstream notebook PC models currently tend to be large and heavy. The launch of the Intel Centrino in the first quarter of 2003 will lead to further polarization in the notebook PC market. The Centrino will be focusing on the highly portable, slim market, while the Pentium 4-M will be targeting the market segment that places equal emphasis on portability and performance. DTS notebook PCs will be targeting the low-portability, high-performance desktop replacement market segment.

Japanese and Korean notebook PC manufacturers have been establishing production facilities in China, and some of these will begin mass production in the second quarter of 2003. However, there will probably be an interval of time before local supply chains and logistics systems are working smoothly. Greater Chinese notebook PC manufacturers have taken nearly a year to move the bulk of production capacity to China after the Taiwanese government lifted restrictions on the establishment of notebook PC factories in China. Japanese and Korean manufacturers can leverage the supply chain that Greater Chinese manufacturers have already established, and can learn from the experience of the Greater Chinese manufacturers, thereby reducing the amount of time lost in establishing operations. Nevertheless, Japanese and Korean players will not achieve the same level of production efficiency currently enjoyed by Greater Chinese makers until after 2003.

In the past, whenever a Greater Chinese notebook PC manufacturer encountered a problem in the development stage or had to secure certification, the product in question had to be sent to customer headquarters, resulting in a great deal of wasted time. Having established R&D centers in Taiwan, leading international vendors' technical personnel are in closer proximity to Greater Chinese manufacturers. Able to deal with problems rapidly as they occur, the R&D centers can also undertake certification operations, thereby significantly reducing the amount of time required for the development process. The establishment of R&D centers in Taiwan overcomes restrictions resulting from national boundaries, reducing as well the number of personnel required, and the frequency with which samples need to be sent back and forth. As international vendors continue to establish R&D centers in Taiwan, Greater Chinese notebook PC manufacturers will be able to reduce the time required for design and thereby increase competitiveness.

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