Chi­nese con­sid­ered un­likely to hurt Tai­wan PC, LCD mak­ers

The China Post - - LOCAL -

The rise of China’s tech­nol­ogy sup­ply chain is un­likely to pose a threat to Tai­wanese man­u­fac­tur­ers of per­sonal com­put­ers and liq­uid crys­tal dis­plays in the near term, ac­cord­ing to a Ja­panese bro­ker­age.

The bro­ker­age said it had just com­pleted a one-day mar­ket­ing trip to Malaysia, where in­vestors asked about whether the Chi­nese tech sup­ply chain would be a for­mi­da­ble threat to Tai­wan in the near fu­ture.

“We be­lieve the PC mar­ket is al­ready ex-growth and hence ap­pears to be less at­trac­tive to Chi­nese com­pe­ti­tion, while Tai­wanese man­u­fac­tur­ers are al­ready run­ning at an ul­tra- lean cost struc­ture,” the bro­ker­age said in a note to clients dated June 8.

“So we don’t think Chi­nese com­peti­tors could be any mean­ing­ful threat to the Tai­wanese PC sup­ply chain in the near term,” the Ja­panese bro­ker­age said.

Un­der Tai­wanese reg­u­la­tions, the name of the bro­ker­age can­not be re­ported be­cause it was of­fer­ing spe­cific fore­casts that could in­flu­ence the mar­ket.

On the LCD sec­tor, the Ja­panese bro­ker­age said Chi­nese com­pe­ti­tion has been in the mar­ket for a while and that Tai­wan panel mak­ers have been able to de­fend their av­er­age sell­ing prices of prod­ucts and pro­tect their op­er­at­ing mar­gins through screen size di­ver­si­fi­ca­tion and fea­ture up­grades.

As a re­sult, Tai­wan LCD mak­ers should be able to main­tain their prof­itabil­ity in the next two to three quar­ters, the bro­ker­age said.

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