Dell gets desperate, latches onto Chinese gov't subsidy to sell more PCs

Posted Mar 27th 2009 3:20PM by Brian White
Filed under: Products and Services, Dell (DELL), Marketing and Advertising

Dell Inc. (NASDAQ: DELL) is going to latch onto the Chinese Government's subsidy of almost $3 billion to that country's farmers. That's right -- perhaps Dell believes those farmers would like to have PCs with that money instead of equipment that could have a more direct impact on the world's third-largest economy.

Although it's a unique opportunity for Dell, the move smacks of desperation instead of seizing an opportunity. China currently makes up 5% of Dell's business, and the company wants to make 15 of its products available there. Dell founder and CEO Michael Dell said "China is likely to emerge faster than any other country and grow stronger ... the Chinese government's stimulus plan will have a positive impact on boosting demand." He means, creating demand, right?

With Dell having purchased $23 billion in parts and equipment in China last year, perhaps the company wants to turn more of that finished goods inventory back to where it came from? With China making up only 5% of Dell's global sales while being the third-largest economy in the world, it's missing the boat (and has missed the boat for years). That doesn't mean Chinese farmers won't bump that percentage up during 2009, though.

Tags: Chinese appliance subsidy, ChineseApplianceSubsidy, Dell, Dell PCs, Dell sales, DellPcs, DellSales

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Reader Comments (Page 1 of 1)

3-27-2009 @ 4:07PM

Daryl said...

Haven't they learned their lesson? Globalism is destroying the economy. Stop doing deals with China that reap billions in profits for a select few, while enslaving the poor.

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