Vaio doubles PC production with supply chains reconnected

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  • Electronics

Vaio doubles PC production with supply chains reconnected

Supply chains for laptop computers have largely recovered from the damage caused by the new coronavirus, pushing manufacturers like Vaio to double production.

The company is keen to cash in on demand fueled by telecommuting, a goal it was hamstrung from achieving while parts supplies from China were halted.

Now with factories reopening in China and elsewhere, supply chains are returning to normal. With the government planning to distribute a notebook computer to every middle and elementary school student, manufacturers are set to capitalize on a rare bright spot in an economy besieged by the coronavirus pandemic.

Vaio, which was spun off from Sony in 2014, is set to double output of mobile computers in May and June at its factory in Nagano Prefecture, using existing facilities but adding workers to increase utilization.

"We're flooded with inquiries about computers for telework," said a manager at Vaio.

"Procuring parts is not as bogged down as it was in February or March," said the manager, who noted that the restarting of parts factories in China and elsewhere is making Vaio's production increase possible.

HP Japan is running its factory in the Tokyo suburb of Hino on Saturdays as well to meet surging demand. The company is even boosting output of models made overseas for sale in Japan, a spokesperson said, without specifying production levels.

In addition to ramping up production, companies are trying to accommodate customers, who increasingly want their products quickly.

Lenovo Japan started offering models Friday that can be immediately shipped to retail customers on an e-commerce platform. On a website for business customers, it also sells models ready to ship in as soon as one to two business days. Views of its products have jumped 20% since March, according to the company.

Vaio is also fast-tracking its process of sending computers to business customers. Since mid-April, it has shipped certain models to those buying on its own website in as little as three business days instead of more than a week.

The sudden move to telework and distance learning amid the coronavirus pandemic has sparked demand for computers in Japan. Laptop sales at electronics stores surged about 50% on the year in April, according to Tokyo research firm BCN. Many businesses scrambled to purchase them for homebound workers in February to April, only to find that computer makers could not fulfill their orders.

The shortage is easing now that "supplies are increasing for LCDs, printed-circuit boards and connectors," which had been in a supply squeeze in March, according to Akira Minamikawa of British research firm Omdia.

Production is recovering in China and Southeast Asia for such big contract manufacturers as Taiwanese companies Hon Hai Precision Industry, or Foxconn, and Compal Electronics, Minamikawa said. Global personal computer output has rebounded to nearly 90% of normal levels, with contract manufacturers are responsible for 70% of production worldwide, he said.

"Our factories have been gradually returning to normal since mid-March," said a spokesperson for China's Lenovo Group, the world's top seller of laptop computers. "Globally speaking, our supply is no longer falling behind demand."

One exception is central processing units, which had been in short supply even before the coronavirus outbreak. Such producers as Intel are prioritizing CPUs for servers.

"Computer demand will stay strong in the medium to long term in Japan as the new way of working is promoted," said an official at the MM Research Institute. "Some parts makers may not be crafting post-pandemic output plans," he said, indicating that some products could remain in short supply.

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Publication Date
Tue, 05/19/2020 - 01:28