Asustek To Outsource Motherboard Production To Flextronics

Motherboard giant Asustek Computer plans to outsource 20% of its own-brand motherboard production to electronics manufacturing service (EMS) giant Flextronics International for the first time, the Chinese-language Economic Daily News (EDN) reported today. Under the outsourcing relationship, Flextronics will also assist Asustek with desktop PC assembly using its worldwide production bases, the paper indicated.

In a company filing with the Taiwan Stock Exchange (TSE), Asustek declined to comment on the report, except to state that it has established some cooperation with foreign EMS makers for its clone motherboard and system assembly business.

EDN further indicated that part of the outsourcing production will be fulfilled at one of Flextronics’ Guangdong plants in China. The strategic alliance between Asustek and Flextronics will help Asustek lower production costs and raise its competitiveness worldwide, the paper added.

As reported on June 20, the combination of Asustek’s R&D and Flextronics’ production capabilities will be a threat to EMS-giant Foxconn Electronics (the registered trade name of Hon Hai Precision Industry), which has extended its customer base through recent acquisitions of diversified IT specialists including handset manufacturer Chi Mei Communication Systems (CMCS) and WLAN-equipment maker Ambit Microsystems, whose major customers include Motorola and Intel.

Source: DigiTimes

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