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Dell might move plant to save labor costs

By Hao Yan (chinadaily.com.cn)
Updated: 2010-06-22 14:15
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Dell might move its manufacturing plant from the eastern coastal city of Xiamen to central or western regions of China after wages increased at plants in coastal cities, the Oriental Morning Post reported Tuesday.

Dell's Xiamen plant mainly supplies goods to China and northeastern Asia markets.

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"Dell will consider moving the plant to central or western regions if workers' wages keep climbing in coastal regions," Min Yida, Greater China president of Dell Inc, said at a forum on Monday.

Also, the company, competing with Hewlett-Packard, Acer, Apple and Lenovo in the global PC market, has adopted a "no-factory" stragegy, selling its plants in China and turned to local manufacturers like the Foxconn Technology Group, one of the world's largest manufacturers of electronic products, the newspaper reported.

Cost-efficiency, flexibility and production cycles are the three criteria the personal computer maker uses to select its manufacturers, Min said.

Foxconn, one of Dell's Chinese manufacturers, is also moving part of its major plant away from the costlier southern coastal city of Shenzhen to Tianjin, near Beijing, following hefty wage increases earlier this month.