Lenovo aims to seize global market share

BEIJING - Liu Chuanzhi, the board chairman of China's largest PC maker Lenovo Group Ltd, said the company will take aggressive action to expand in the international market and aims to move into the No 2 spot by the end of this year.

A few weeks ago, No 1 PC maker Hewlett-Packard Corp (HP) announced it will spin off its PC sector and halt production of its Internet mobile devices, such as smartphones and tablet PCs. In addition, Apple Inc's former CEO Steve Jobs resigned.

"The resignation of Jobs eased pressure on Lenovo," said Liu.

He used to criticize Jobs for not paying enough attention to the Chinese market. Now the Chinese company is glad to fill the gap in the overseas market left by its international competitors because of strategy adjustments.

More than 10 years ago, Lenovo was a newcomer to the international market and only had 3 percent market share. Last quarter, it held about 12 percent market share, and it now aims to surpass international peers such as Dell Inc and Acer Inc to become the second-largest PC provider.

Last quarter, HP held 17.5 percent of the global PC market share while Dell accounted for 12.5 percent, according to the US-based market research company Gartner Inc.

"The Chinese market is the starting point for Lenovo, but it won't be the only place Lenovo should put emphasis on. We will set up a more active strategy for expanding in overseas markets," Liu said.

The company now controls 35 percent market share in China as the biggest domestic player. In the last quarter, China has surpassed the United States to become the world's largest PC market.

"Although Lenovo's market share in global mature markets is still relatively small, it has a very strong advantage in the Chinese market," said Kitty Fok, vice-president of IDC Asia-Pacific.

"We forecast China will continue to experience rapid growth over the next quarter, especially in the mobile Internet sector," she said.

Lenovo China recorded $2.8 billion in sales revenue from April to June, accounting for 47.9 percent of its global figure, while 34.6 percent of sales came from overseas mature markets such as the US and Japan.

After it purchased the PC division of the US-based IBM Corp a few years ago, Lenovo announced it would put greater emphasis on the global market and seek more acquisitions.

In January, it announced a $175 million joint venture with Japan's NEC Corp. In July, Lenovo completed its acquisition of Medion AG, a German multimedia and consumer electronics maker.

"I think the purchase of IBM has been very successful, and now merging or cooperating with overseas companies is a good way for Chinese companies to enter international markets," Liu said.

Aside from the PC market, Liu mentioned that Lenovo will also progressively make its presence felt this and next year in the emerging Internet mobile market, including smartphones and tablet products.

China Daily

(China Daily 09/09/2011 page13)