Notebook makers under pressure due to high material cost

Despite being confident it will meet its notebook shipments target in 2008, Wistron company chairman Simon Lin noted that material cost pressure has been more acute than component shortages for fellow notebook OEMs in the second half of 2008.

Thanks to joint efforts made by all OEMs, the previous battery shortages are not a big problem for OEMs now, Lin said. Shortages for key components such as LCD panels and chassis have also eased, he added. He also indicated that shortage of labor in China should also improve this year without much production will be affected.

Lin noted in saying that material and labor shortages will not pose a critical impact on the notebook industry in the second half of 2008, but rising material and labor costs are issues that have to be addressed. Production costs continue to surge amid high crude oil prices, and electricity costs in China are also rising, further dampening OEM profitability.