Low labor costs and a fast-growing domestic market will spur China's consumer electronics manufacturing industry to more than double by 2010, reports In-Stat.

The industry will grow from US$71.5 billion in 2006 to US$167 billion in 2010, the high-tech market research firm says. China's mature supply chain, a skilled labor force, and convenient logistics are the key factors to attracting outsourcing manufacturers from abroad.

"About two-thirds of China's electronics manufacturing revenue comes solely from foreign-funded or Sino-foreign joint ventures," says Anty Zheng, In-Stat analyst. "The world's top 10 electronics manufacturers have all invested in China and consider China to be a key region in their global manufacturing facility layout."

In-Stat says China-based electronics manufacturing companies contributed about 8% of China's total US$425 billion electronics manufacturing industry revenue in 2005. Compared to its mature manufacturing environment, China's R&D ability, especially in chip design and solutions, is still weak: over 90% of chips for electronic manufacturing still depend on imports.

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