[photopress:it_MichaelDell.jpg,full,alignright]Dell, the world’s second largest PC maker, said it will source 28% more components from China this year to fuel growth in emerging markets.
Michael Dell, chief executive of Dell and shown here, said in Beijing that the company plans to buy $23 billion of components from Chinese suppliers this year, up from $18 billion in 2007.
He said, ‘Including last year, this year and expected purchases next year, Dell will purchase $70 billion worth of computer-related supplies and equipment from China.’
Dell posted revenue of $16 billion in the fourth quarter ending Feb 1, an increase of 10% compared with the year-earlier period. Dell wants to cut costs by buying more components from China so it can take on rivals like HP, Acer and Lenovo in the emerging markets.
According to research firm IDC Dell held 7.9% of China’s PC market in the fourth quarter last year — behind Lenovo, HP and Founder Technology,
Dell’s direct sales model is hindering the manufacturer from making inroads into China’s growing rural consumer market in that it is not a typical nor yet traditional way of making such a purchase.
Dell yesterday denied speculation that it’s looking for acquisition targets in China. Amit Midha, president of Dell (Greater China), said the company doesn’t have plans to acquire smaller players in the country.
Source: China Daily