2Q NB growth driven by China market: DRAMeXchange

TAIPEI, TAIWAN: According to DRAMeXchange, owing to benefits provided by the shipment of new projects, the NB ODMs are still optimistic toward 2Q notebooks (including netbooks) shipment and estimate that the QoQ shipment growth can reach 15 percent.

The April MoM shipment is likely to drop 3-5 percent due to that increasing March shipment had elevated the base period number and the delayed shipment caused by component shortage. Since component vendors are still cautious about increasing production under the uncertain long term demand, they would rather stay under shortage condition rather than facing future oversupply.

Component shortage is still the major uncertainty. Some finished goods will delay shipping until May and the shipment of May is hopefully to increase again if the component shortage vanishes. The June shipment is possible to remain May level, states DRAMeXchange.

The current demand growth mainly comes from China and the US market. The strong buying of China consumer market is driven by government support, and the US consumer market also shows signs of reviving. The demand of another major market Western Europe, not only hasn’t started recovering yet but even is still under the risk of continuing slowdown. For commercial market, things are still quiet.

The China consumer market obviously benefits from its government Home Appliance Subsidy Policy, which started stimulating shipment from March, and the second wave of shipment starts about in May will drive additional demand of 2Q.

According to the estimation of vendors, the Home Appliance Subsidy Policy creates an additional 3 million units of NB demand, which is a major contribution to the 12 million scale China market. The shipment increase caused by the policy is distinctive. Except the NB ODMs, the branding company Lenovo is the major vendor that benefits most among industry.

Since major international branding companies such as Dell, HP, and Acer mainly focus on 1st tier cities of China, comparatively, Lenovo has been cultivating sales channels in 3rd tier cities and has greater chance to increase PC shipment this year.

The current NB orders are visible through June, which is no longer than six weeks. Therefore the vendors remain cautious about the coming market situation. However, the NB is sure to recover and stay growing quarter by quarter this year. The desktop and motherboard are not as healthy as NB.

Since the commercial market demand shows no sign of reviving and the NB products keep squeezing the consumer market, the MB is meant to show negative growth in 2Q under weakening demand. With the uncertain 2H demand, MB vendors are now more flexible while facing 3Q shipment. Except hot season demand, if the market sales are lower than expectation, they will clear their inventory in 4Q and make sure that they won’t get hurt from 4Q inventory.