Lenovo lays out European plans

All-out assault on EMEA in 2008

Lenovo is continuing to blaze a trail across the PC market as it plans an expansion into the consumer market in Europe.

The company is planning an all-out assault on the EMEA region in the coming year, with new products and a new focus on the consumer market set to take shape.

In Europe, France will be the first country to roll out Lenovo's new consumer machines and other countries will follow on a phased basis. There are no indications yet when the consumer machines will reach Ireland.

Despite losing out on the Packard Bell bid to Gateway, the company's strategy in Europe will remain unchanged, Milko van Duijl, president of Lenovo EMEA, told journalists in a conference call on Wednesday, but warned that the pace of its progress will be affected.

"We had already decided to open a consumer business unit," explained van Duijl. "We felt it would provide us with massive acceleration."

Van Duijl said Lenovo felt the acquisition of Packard Bell would have been "a good marriage". However, Gateway beat the company to the punch and indicated it would exercise its right of first refusal to acquire shares in Packard Bell's parent company, PB Holding Co. SARL, from John Hui. Hui founded eMachines, a firm Gateway bought in 2004, and is also the largest shareholder in Packard Bell.

"We have to grow in an autonomous fashion; it will take us more time. Acceleration is the main change," said van Duijl.

Lenovo has already decided to ditch the IBM logo on its Thinkpad products earlier than planned, and by January all the IBM-branded Thinkpads and Think products are expected to have been distributed, leaving the way clear for the Lenovo-branded products to hit the market.

"It doesn't mean we will drop the Thinkpad or Think logo," said van Duijl. "There is a lot of brand recognition."

Van Duijl said the decision was taken on the back of customer and partner feedback that indicated there was confusion over the continued use of the logo.

As well as its launch into the European consumer market, the Chinese PC maker is also planning to open a Europe-based manufacturing facility for its products.

"Companies today source everything where best available and sell in the best markets. World-sourced companies can work 24 hours a day, following the sun," said van Duijl. "Our hubs serve as centres of excellence for different functions."

Van Duijl said the announcement on the manufacturing location would be made soon.

Lenovo has had a run of good results recently. The most recent financial announcement saw EMEA turnover increase by 18 per cent year-on-year to reach $886m.

The results, for the second quarter of fiscal year 2008, showed an overall rise of 19.8 per cent year-on-year for the computer maker, which saw its total turnover climb to more than $4.4bn.

Meanwhile profit in the EMEA region continued to rise this year, from $14m in the first quarter of the fiscal year to $44m in the second. Lenovo has also seen great success in its desktop PC sector, with growth in the division outstripping market growth fourfold.

© 2007 ENN

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