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HP to Allow Europeans to Assemble PCs

From Bloomberg News

Hewlett-Packard Co. said Monday that it will allow some European distributors to assemble the company’s personal computers, in a move that could cut delivery shipment time to as little as two days.

The Palo Alto-based company said the change will help it compete with other manufacturers that sell computers directly to European customers without using independent distributors.

“The bottom line here is better availability, mass customization and faster cost reductions,” said Borel Setten, Hewlett-Packard’s PC marketing manager in London.

Hewlett-Packard faces stiff competition in a European PC market made slow by weak economies and high penetration rates.

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The last three months of 1996 were challenging for personal computer makers, with only Britain showing strong growth, according to market research company International Data Corp.

Hewlett-Packard’s personal computer sales in western Europe grew 22.9% in 1996 over 1995, according to IDC.

The company shipped 833,000 units last year for a market share of the European market of 5.2%, placing it third behind Compaq Computer Corp. and International Business Machines Corp.

Companies such as Dell Computer Corp. specialize in selling computers directly to users who call in with their requirements. The company has recently started selling to business users.

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Dell Computer Corp.'s share of the European market grew 40% in 1996.


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