Compaq opens Shenzhen manufacturing facility; Compaq's fifth worldwide manufacturing facility to serve growing PC demand.

SHENZHEN, China--(BUSINESS WIRE)--Sept. 18, 1995--Compaq Computer Corporation has announced the official opening of Compaq Computer Technologies (China) Ltd in Shenzhen, The People's Republic of China. The facility will enable Compaq to increase the production of its desktop personal computers and power supplies to serve the growing computing needs of the Asia Pacific region.

The 170,000-square-foot facility has one CPU line as well as three power supply lines. Compaq currently employs a total of 600 people at the factory.

This new facility enables Compaq to increase the production of its products to accommodate the growing customer segment in the Asia Pacific area. According to the most recent Dataquest figures, Compaq edged out competitors to become the largest personal computer vendor in China with a marketshare of 21.3 percent.

During a press conference to officially open the Shenzhen facility, Compaq President and CEO Eckhard Pfeiffer said, "China is a market with a huge potential. Compaq continues to see the growing demands in this market for high quality PC products. We chose to establish this facility in Shenzhen as it offers high quality and effective manufacturing opportunities. In addition to the present production capacity, we are also considering further expansion plans in the volume of CPU production and other new manufacturing activities."

The plant marks a new milestone in the business development of Compaq in China. Compaq is one of the first companies to establish a manufacturing facility in this highly competitive market. The Shenzhen facility began operations in August 1994, with a registered capital of $2.6 million. Compaq now holds a 90 percent stake in this joint venture between Compaq and Beijing Stone (Group) Corporation. Under the 11-year agreement, the joint venture will manufacture PCs to meet increasing customer requirements.

"This is a very positive step forward in our business here and demonstrates our commitment to the China market," said Pfeiffer. "We are delighted to cooperate with Stone Corporation in setting up this facility as Stone is a well-established private company in China with a proven track record and excellent market reputation for professionalism, entrepreneurship and vision."

Wong Chee Wai, general manager of Compaq Computer Technologies Ltd said, "This facility will enable Compaq to sell products in China in RMB and reduces the logistics costs. Most of the products manufactured will be distributed to countries in North Asia while power supplies will be distributed worldwide. The facility will also produce products for the entire Asia Pacific region. Plans are also underway to source for materials domestically whenever costs permit."

Worldwide Manufacturing

The demand for Compaq's desktop, portable and server products worldwide has continued to drive manufacturing expansion throughout the world.

At its worldwide headquarters in Houston, Compaq operates 610,000 square feet of manufacturing facilities. This operation, established in 1983, includes the assembly of printed circuit boards as well as all Compaq products.

Established in 1987, Compaq's European manufacturing, located in Erskine, Scotland, is the main supplier of the complete line of Compaq products for Europe, Africa and the Middle East. The 540,000-square-foot facility, located in Europe's "Silicon Valley" builds the full-range of desktop and server products.

Compaq's Singapore facility is currently doubling its size to 730,000 square feet. This facility produces desktop and portable PC products and printed circuit boards for the Asia/Pacific region as well as other markets as necessary.

In 1994, Compaq established a manufacturing facility in Jaguariuna, located near Sao Paulo, Brazil. Initially, the 150,000- square-foot facility will produce desktops and surface mount technology assembly for the growing needs of the South American market.

Company Background

Compaq Computer Corporation is the world's largest supplier of personal computers, offering desktop PCs, portable PCs, and servers. Founded in 1982, the company reported 1994 worldwide sales of $10.9 billion. Compaq products are sold and supported in more than 100 countries through a network of more than 38,000 Compaq marketing partners. Compaq also sells directly to customers through Compaq Direct Plus at 1-800-888-5858. Compaq provides 24-hour customer support and can be reached through the Compaq forums on America Online, CompuServe, Internet, and Prodigy, or by calling 1-800-345-1518. -0-

Compaq, Deskpro Registered U.S. Patent and Trademark Office. DirectPlus is a service mark of Compaq Computer Corporation. Product names mentioned herein may be trademarks and/or registered trademarks of their respective companies.

Editor's note: an accompanying photograph is available on AP PhotoExpress via BusinessWire.

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