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Electronics Production | August 23, 2005

BenQ face fierce competition

Taiwanese Electronics giant BenQ, has lowered its sales for this year's second quarter. This will make it difficult for BenQ to put newly acquired Simens Mobile on its feet.

BenQ's total sale during the second quarter this year was 29.7 Million Taiwanese Dollar. The total sale for the same period last year was 42.1 Million Taiwanese Dollar. The lowered sale is due to a tougher competition at mostly computer related products. BenQ also lost one of its top clients for Mobile Systems, Motorola. The reason was that BenQ's Siemens Mobile acquisition will make BenQ a competitor of Motorola. BenQ will need a lot of capital to invest in Siemens Mobile to make it profitable, therefore BenQ's weak sales are not good, analysts told IDG News. BenQ has to double its sales to get the Mobile Division profitable. IDG News said that BenQ will have difficulties in cutting back on their already low costs for Siemens Mobile, thus the German work laws are very strict. Siemens Mobile also had a difficult second quarter this year. It could be necessary for BenQ to lowering its number of component suppliers and outsource more of the production to EMS Providers. However prices on components are on its way up, therefore BenQ is counting on a sale increase of 10 per cent during this quarter.
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