Dongbu HiTek sharpens foundry focus on Chinese fabless market

SOUTH KOREA: Dongbu HiTek announced the opening of sales/marketing offices in Shanghai and Beijing with plans to open another soon in Shenzhen.

The company’s bold move signals how important the rapidly growing Chinese fabless market is to its foundry business. The new offices in China strategically expand Dongbu HiTek’s global network of previously established offices in the US, Taiwan, Japan, United Kingdom and Italy.

“Our sales momentum in China has been building steadily over the past few years fueled largely by demand from fabless Chinese companies in need of our specialized foundry services,” said Jae Song, Dongbu HiTek EVP of marketing. “We aim to increase our annual foundry sales to China from 8 percent of total sales in 2012 to 13 percent in 2013 by manufacturing cutting edge chips for smart phones, tablet PCs, laptops and TVs.”

Among the wide range of advanced chips that Dongbu HiTek has already manufactured for Chinese customers are touch-screen controllers, sensors and power management chips.

By establishing offices in mainland China’s most vibrant business centers, Dongbu HiTek expects to strengthen its relationships with current Chinese customers by providing a more responsive on-site customer service. The Korean company also expects to more swiftly capture a greater share of the mushrooming sales of foundry services to Chinese fabless companies, particularly those developing ICs for smart phones and other consumer products.

According to iSuppli, sales revenue generated by Chinese fabless companies is forecast to grow from approximately $8.2 billion in 2013 to about $12.4 billion in 2016. By another estimate from Gartner Inc., the worldwide shipment of smart phones is forecast to more than double over the next four years (2012-to-2016). Over this same period, Chinese smart phone shipments are expected to rise from 25 percent to 33 percent of the total.