2022 ASC 100 exclusive interview with chairman Tom Cho: Inventec delves into the metaverse

Aaron Lee, Taipei; Eifeh Strom, DIGITIMES Asia 0

With 47 years of experience, Inventec continues to lead the industry as the world's largest manufacturer of commercial notebooks and server motherboards.

Inventec chairman Tom Cho pointed out that Inventec is a people-oriented engineering company, not just an original device manufacturer (ODM). Through actively undergoing a digital transformation, Cho hopes the company will become a metaverse-oriented group.

Inventec's accumulated revenue reached NT$467.57 billion (US$15.73 billion) in 2021, for an on-year increase of 2.25%. Revenue from January-April 2022 amounted to NT$172.95 billion, a 15.27% increase on year.

Despite the difficulties brought on by the COVID-19 pandemic over the past three years, Inventec continues to show strong momentum.

Cho noted that the COVID spike has not resulted in any changes to the personnel assigned to China in the last two years, which has been difficult for most companies to accomplish. Prior to the lockdown in Shanghai, workers drove all day from Tianjin to Shanghai to support the facility. Cho added that just as the company considers its people its assets, employees consider the company home.

Inventec chairman Tom Cho.  Credit: DIGITIMES

Inventec chairman Tom Cho

In the past, Cho considered the company an ODM, but it is more than that. Inventec provides engineering services, which contribute significantly to customers' product development processes. It also helps customers with product design. For example, Hewlett-Packard (HP), a customer of Inventec, awarded the company with the award for best design in 2021.

Cho tells colleagues that the main two considerations for good product design are customer requirements and technology. He also said Inventec has been able to navigate the recent fluctuations in the industry, such as the impacts of the lockdowns in eastern China, due to its extensive industry experience.

Cho emphasized that society will always find a way to coexist with viruses. As the situation in Shanghai progresses, Inventec has resumed operations. The Chongqing factory in western China continues to operate normally. Revenue in March reached a new high in 2022 but fell in April. Shipment numbers have increased compared to the same period in 2021. Although materials have been affected, the company has been able to rise to the challenge.

In terms of the uneven materials supply problem, even though notebook production at Inventec's Chongqing facility has recorded new highs, it is still unable to meet customers' demands. Overall notebook shipments in 2022 are expected to be revised downward.

Since Inventec mainly produces commercial notebooks, shipment revisions will not be significant, according to Cho. However, the impact of global inflation is more difficult to predict and will continue to be monitored.

Compared to notebooks, server demand is more stable and the impact of the Shanghai lockdown has been limited. Although production capacity has yet to be fully restored in Shanghai, production capacity at its Taiwan and Mexico facilities are operating normally. Construction of a new facility in Mexico is in full swing, with investment already totaling US$120 million.

In addition to notebooks and servers, Inventec continues to make advances in automotive electronics, Al, and the metaverse. Cho said future cars will be like moving servers, a field Inventec excels in. Regarding the automotive market, Inventec has already applied for ISO certification to produce automotive use products at its facilities in Mexico and the Czech Republic, which will service North American and European automakers.

The group is also fully embracing AI while also carrying out its digital transformation strategy, increasing the transparency of the company's internal information and making it easier to use at any time. To fully embrace digitalization, Inventec plans to establish a metaverse center in Shanghai to research and design related products.

Cho pointed out that Inventec continues to evolve. Cho still has one year left in his term as chairman. Once the new chairman is chosen, changes will also be made to the group's middle and senior management structure. Cho also believes Inventec will attract more international talent in the future, which will allow the group to advance its globalization plans.

About ASC 100:

Asia Supply Chain 100 (ASC100) 2022 ranks the top 100 Asian tech companies, focusing on electronics, information & communication technology, machinery, and automobile industries, by their revenue in 2021. The top 100 companies were able to manage uncertainties and succeed. Based on the rankings, DIGITIMES Asia also summed up the findings and insights in a series of articles.