Pegatron Corp (和碩), one of Apple Inc’s iPhone assemblers, yesterday said it is planning to expand manufacturing sites in Vietnam, India and North America to meet customer demand for production diversification, amid supply chain chaos attributable to the fallout of the COVID-19 pandemic.
The unpredictable effects of COVID-19 and unstable supply chains have increased uncertainty worldwide regarding consumer demand and the shipping of products, Pegatron said in its annual report.
“Pegatron will continue monitoring the supply of key components and working closely with its suppliers to optimize capacity allocations,” the company said.
Photo: Huang Hao-chen, Taipei Times
The remarks came as the firm held its annual general meeting in Taipei, where shareholders approved the distribution of a cash dividend of NT$5 per share.
That represented a payout ratio of 64.85 percent based on the company’s earnings per share of NT$7.71 last year.
Pegatron’s board of directors last month approved a plan to invest an additional US$50.61 million to expand its manufacturing hub in North America, the company said in a regulatory filing.
Pegatron said it had already planned to invest US$164 million on production lines in North America so that it could accommodate an increase in orders in the region.
The company has factories in Taoyuan, as well as operations in Mexico, Indonesia and the Czech Republic, while China is still its most important manufacturing hub, with factories in Kunshan, Suzhou, Shanghai and Chongqing.
Pegatron expects an increase in demand for information technology products, especially commercial PCs, as people gradually return to the office, the annual report said, adding that the launch of Microsoft Corp’s Windows 11 operating system would stimulate PC replacement demand.
As communications products, such as smartphones, are affected by seasonal cycles, Pegatron said it plans to boost production efficiency and improve management to navigate the industry’s ups and downs.
Last quarter, communication products were the biggest revenue contributor, accounting for 60 percent of total revenue, the company said.
This year, Pegatron expects its automotive electronics business to contribute more revenue, thanks to an increase in orders.
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