Lenovo will begin production of desktops and notebooks at its base in Chengdu City, western China, on December 19, with expected output of 2-3 million units in 2012, accounting for 10% of Lenovo's total shipments, according to industry sources.

To balance its urban and rural development, the China government has been aggressively pushing the PC industry to invest in western China with the cities of Chongqing and Chengdu competing the fiercest over related investments. Hewlett-Packard (HP), Acer and Asustek Computer have chosen Chongqing for their new production base while Lenovo and Dell chose Chengdu.

Although Foxconn's plants in Chengdu currently supply two-thirds of global iPad shipments, Chongqing's advantage due to its railroad connection to Europe is also expected to allow Chongqing to attract players to expand their investments.

50 of Lenovo's upstream partners such as Wistron, TPV and Asia Vital Components are also expected to follow suit and make investments in Chengdu.

In additional news, Dell also reportedly plans to start PC production in May 2012.

However, labor shortages and an incomplete supply chain are both potential problems that are already occurring in western China.

By: DocMemory
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