Hon Hai Targets to Ship 20 Million DSCs in 2008

Japan-based Sony Corp`s (Hon Hai`s major client) expanding market share will enable Hon Hai Precision Industry Co to ship some 20 million digital still cameras (DSCs) this year, representing a 17.6 percent year-on-year growth.

After merging with then Taiwan`s No.1 manufacturer of DSCs-Premier Technology Co, last year, Hon Hai shipped 17 million units of DSCs in 2007 to hold firmly its position as Taiwan`s top DSC supplier.

In addition to Hon Hai, Taiwan`s other two DSC suppliers, including Ability Enterprise Co. and Altek Corp, will each see shipments reach 15 million units this year.

After merging with Premier, Hon Hai has seen consistent growth in orders from such major clients as Olympus and Sony in 2007. Sony sold 22 million units of DSCs last year and it aims to sell between 26 million and 30 million units, with such growth expected to benefit Hon Hai`s steadily increasing shipments this year.

At present, Hon Hai mainly focuses on the eight megapixel DSCs, which account for half of the company`s total sales of such products. Besides, such high-tier products as 10-megapixel and 12-megapixel DSCs command 30 percent of Hon Hai`s total sales. The dominance of high-end models is expected to help Hon Hai offset the impact of declining prices of DSCs over the past several months.

Hon Hai has established production sites in mainland China, Brazil and Vietnam, with the largest being the one in Foshan, Guangdong province with monthly production capacity of two million units of DSCs.

Based on the projected global shipment of 130 million units this year, Taiwan`s top-three DSC suppliers will have a combined 39.2 percent market share.

Altek said the eight-megapixel model is the mainstay DSC this year and 10-megapixel models will replace it in 2009; while the company said the price volatility of DSCs will subside this year.

An institutional investor said the demand for DSCs has been slowing globally, with major growths to come from the emerging markets and machine-replacement demand in industrialized nations this year.

Source: CENS