Lenovo Starts Joint Venture with Compal to Support Growth
Lenovo has several titles under their belt -- including fastest growing PC company, and world's third largest PC company -- which they're not afraid to use.
And to accommodate that tremendous growth, Lenovo has entered into joint venture with Compal Electronics, a Taiwanese original design manufacturer (ODM).
This joint venture will be in a form of a company that acts as a standalone supplier and will be manufacturing laptops and desktop machines exclusively for Lenovo.
Initial investment costs will be US$100 million, Lenovo will hold 51% stake of the JV.
The Hefei facility will start churning out notebooks and desktops by 2012, but there were no details on the capacity, or whether it will produce tablets as well.
“This joint venture will help us further optimize our manufacturing network, increase production capacity and satisfy rapidly growing demand for our offerings," Lenovo CEO Yang Yuanqing said.
The world's largest PC manufacturer, HP, is currently having some internal problems, and the future of its PC manufacturing arm is in doubt.
Lenovo probably sees this disarray as a chance to further gain on its competition, if it doesn't decide to buy HP's PC business altogether.
But Lenovo also has problems of its own, when they had to watch Apple take over their home turf this August.
The next few months will certainly be interesting to see if Ultrabooks can give be what PC manufacturers need to compete with Apple.