Dell Denies Discussing China Move With India Minister

March 25, 2010

Dell Inc. denied an Indian government release that Chief Executive Officer Michael Dell discussed shifting procurement from China to a "safer environment" with Indian Prime Minister Manmohan Singh.

"There was no discussion concerning any change in how or from where Dell will source component parts for the computers it manufactures in Asia," Minari Shah, a Dell spokeswoman, said in an e-mailed statement today.

Dell sources "equipment and parts worth $25 billion from China," Singh told members of India's Planning Commission on March 23, according to an e-mailed text of his speech released by India's Press Information Bureau that evening.

"They would like to shift to safer environment with climate conducive to enterprise with security of legal system," Singh told the plan panel. "So I think this is an area where there are immense opportunities," he said in the speech.

The Web site for the Press Information Bureau, where releases of Singh's official speeches are posted, no longer has a copy of the remarks. The text was removed after officials from the Round Rock, Texas-based company contacted the Indian press office, Dell's Shah said. Harish Khare, a media adviser to Singh, declined to comment.

Holding the Hammer

Dell should avoid damaging relations with the Chinese government because it's such a large market, said Tom Wirth, senior investment officer at Chemung Canal Trust Co., which manages $1.6 billion in Elmira, New York, and doesn't own any shares of Dell.

"For Dell as a company, certainly that hurts," he said. Flare-ups between U.S. companies and China, including Google Inc.'s clash over censorship, could affect relations between the two countries, Wirth said. "The fact is China holds the hammer to us -- we are indebted to China and not the other way around at this point," he said.

China accounted for more than 60 percent of all personal computers shipped in the Asia-Pacific region last quarter, according to Gartner Inc. Shipments in that area climbed 44 percent, the fastest rate among the regions surveyed, according to the Stamford, Connecticut-based researcher.

Michael Dell met Singh the day after Google started routing China-based users to an unfiltered search service on its Hong Kong site, following through on a Jan. 12 statement to end self- censorship of its Google.cn portal. Dell declined to comment March 23 when asked about Google's decision.

Dell dropped 12 cents to $14.87 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have climbed 3.6 percent this year.

--Editors: Suresh Seshadri, Peter Elstrom

To contact the reporters on this story: Mehul Srivastava at This e-mail address is being protected from spambots. You need JavaScript enabled to view it ; Mary Childs in New York at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

To contact the editor responsible for this story: Young-Sam Cho at This e-mail address is being protected from spambots. You need JavaScript enabled to view it