Asustek Computer has selected Compal Electronics as the exclusive manufacturer of its second-generation ZenWatch, to be launched in July 2015, according to Taiwan-based supply chain makers.

Asustek unveiled the first-generation ZenWatch in September 2014 and launched initially in North America and Japan in November. The model was produced by Pegatron. With much better than originally expected sales, production capacity has only been able to meet less than 50% of demand, Asustek CEO Jerry Shen said. In view of large demand, Asustek has decided to launch a second-generation model and Compal will start shipments at the end of June.

Pegatron's first-generation ZenWatch output was short of demand partly because yield rates were not high enough, the supply chain makers said. Compal is expected to meet demand, the sources indicated.