Acer grabs No. 1 spot in Taiwan’s notebook PC market

Benefiting from its new business model, Acer Inc. earned an extremely high YoY growth of 202.6 percent in Q405. The company shipped 2.24 million units of notebook computers, surging ahead of its own sales target with 0.3 million units more than Toshiba, according to figures released by Gartner Dataquest and IDC. Acer is now keen to grow its market share in the United States and is hotly chasing its dream of becoming one of the top five vendors within the next five quarters.



Acer’s record shipment is baffling its competitors. JT Wang, chairman and CEO of Acer, forecasted that in Q106, the company will reach an estimated 1.9 million unit shipment, resulting in 90 percent YoY growth. “We are number one in Europe but will be more aggressive in the United States and Asia,” he said.

Despite Acer’s record performance, its shipment figures are hardly registering a blip on Dell Inc.’s radar screen. But the American PC company is not taking that threat lightly. Kevin Rollins, CEO of Dell, said that they would seriously monitor Acer’s threat in the notebook PC market. However, Wang is quick to point out that while Dell adopts a direct selling model targeting enterprise users, Acer’s distribution strategy is more focused on brand marketing and distribution through SMEs and consumer electronics channels.



As for OEM activity, Taiwan has already become a hotbed of notebook manufacturing. This is mainly due to Japanese PC companies driving a hard bargain on getting the lowest price possible and subsequently flooding the island’s OEMs with valuable orders. Ditto for Dell, which has increased market share of notebook PCs and indirectly benefiting its OEM vendors like Quanta Computer Inc. and Compal Electronics Inc.



According to a report by Market Intelligence Center (MIC), Taiwan OEMs now dominate the global notebook PC market with over 80 percent market share. “Taiwan has got 82.41 percent market share in worldwide notebook PC market, with a YoY growth of 10.11 percent,” says Cynthia Chyn, deputy managing director of MIC.



Chyn explains that the replacement market for desktop PCs has become the catalyst prompting Taiwan OEMs to produce more notebook PCs. In this connection, Dell, HP and Acer, among others, plan to launch a number of entry-level notebook PCs for the low-cost market.



According to DRAMeXchang, a local research institute, the top five OEMs in Taiwan are Quanta, Compal, Wistron, Asus and Inventec. These companies have a combined shipment of 41.1 million units, gaining 82.4 percent market share of Taiwan’s notebook PCs.



DRAMeXchang also reported that Taiwan OEMs have bagged a significant portion of outsourcing orders of branded notebook PCs, except those of Sony, Fujitsu and Toshiba, as these companies continue to produce 30 to 50 percent of their notebooks inhouse. Under the pressure of price competition, industry observers think that it may not be too long for these Japanese companies to outsource their orders to Taiwan OEMs.