Dell says India plant to be operational by end-2006

By : |May 26, 2006 0

NEW DELHI  – Dell Inc. expects its proposed Indian plant to begin
production by end-2006 and help the world’s largest personal computer maker to
win share in a booming market by cutting delivery time.

"We would like to have this manufacturing facility up and running within
this year," Paul-Henri Ferrand, Dell’s vice president for South Asia, told
reporters on Thursday. He did not say where the plant would be set up or how
much Dell will invest.

"Local manufacturing will enable us to have the same supply and delivery
chains as we have in many other markets."

Texas-based Dell has a 5 per cent share of the Indian market, which is
estimated at 4.6 million units a year and is growing nearly 30 percent annually.

Dell said its revenue from Asia’s third-largest economy surged 40 percent to
$80 million during February-April, from the same period a year ago.

India will be the seventh location where Dell has a plant. It has two
manufacturing sites in China and one in Malaysia in the region, where demand for
computer hardware is soaring due to relatively lower penetration rates compared
with western markets.

Dell, which pioneered a direct delivery model, competes with global players
such as Hewlett-Packard Co., International Business Machines Corp. and local
giants like HCL Infosystems Ltd. and Wipro Ltd. in India.

There is strong demand for computers from the fast-growing banking, financial
services, telecoms and information technology industries that are automating
business processes and setting up nationwide IT networks.

Falling prices, cheaper finance and rising salaries are also fuelling retail
demand for desktops.

It takes Dell about 10-15 days to ship a product to an Indian customer
because of the time taken in transportation from either Malaysia or China and
then clearing customs.

The delivery time will be cut to 3-4 days once the Indian plant is fully
functional and lead to substantial cost savings as transportation costs and
duties will come down dramatically, said Rajan Anandan, vice president of sales
for India.

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