HP announces KSA assembly plant

HP has announced plans to open a local PC assembly plant in Saudi Arabia in the second half of next year. The plant, which will serve the Kingdom and its neighbours, is expected to produce up to 60,000 units per annum.

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By  Neil Denslow Published  December 12, 2002

HP has announced plans to open a local PC assembly plant within Saudi Arabia in the second half of next year. The plant, which will serve the Kingdom and its neighbours, is expected to produce up to 60,000 units per annum.

The vendor is opening the plant mainly in order to win over SMB customers that are currently using white box PCs. “Our goal is not to substitute our current market… but to supplement our current offerings,” explains Antoine Maury, general manager, personal system group, EMEA, HP.

The plant will allow the company to tackle the SMB market more effectively, as its PCs should be cheaper. Firstly, it will be able to cut supply chain costs, more importantly, however, building the PCs in Saudi Arabia will allow HP to avoid paying import/export duties in the Kingdom and the GCC. “There are certain tax advantages to having Saudi Arabia as your product’s country of origin,” says Maury.

The Saudi assembly plant will be only the third one that HP has opened worldwide. The vendor chose to locate a plant in the region because of the predicted growth opportunities. “We believe that there is a great future in the Middle East,” comments Maury.

As yet, the company has not decided where exactly it will open the plant, as it is still assessing which partners it will work with and which will be the best site logistically. However, wherever the plant opens, HP believes that customers will appreciate the local assembly presence. “The closer you manufacture, the more effectively you can meet the customer’s needs,” says Maury.

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