May 28, 2001

Following its recent establishment of two plants in the Netherlands, Acer Inc. of Taiwan has decided to set up its second production base in Hungary for the manufacture of desktop PCs initially, thus paving the way for it to enter the Eastern European market.

According to executives of Acer, the firm acquired a six-hectare land site in Tatabanya for this plant, which calls for an investment of US$ 15 million.

Presently, Acer's production capacity in the Netherlands is unable to meet the increasing market demand. The establishment of the Hungary plant will be a must to venture into the Eastern European market in the future, Li Bi-yao, vice president of Acer, said.

Acer expects production to start in the third quarter of this year if the firm decides to first rent a plant. If the pending decision will be to start from their own plant, then formal production will begin in the second quarter of 2002.

Acer's self-established factory in the Netherlands now products notebook PCs with a production capacity reaching between 50,000 and 60,000 units per month. The other factory, which is rented, mainly produces desktop PCs, and has a monthly production capacity of about 80,000 to 100,000 units.

The new Hungarian plant will produce desktop PCs during the initial period.
Acer said that the plant would produce both self-owned brand products as well as serve OEM clients.

Over the past few years, Acer has already established PC plants in Hsinchu, Taiwan, Subic Bay in the Philippines, in Texas, Mexico, the Netherlands and in two locations in Guandong province, South China.