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Taiwan's Machine Tool Makers Speed up Expansion Plan

Dec 11, 2014 | By Ken Liu

Taiwan's leading machine-tool makers are accelerating their investment plans to alleviate the problem of insufficient production capacity, despite the hazy business outlook for 2015.

The Tongtai Group's board of directors recently approved an investment of NT$600 million (US$20 million at NT$30:US$1) to build a new factory in Kaohsiung, southern Taiwan, to help reach its goal of squeezing into the world's top 20 machine-tool makers by 2020.

The planned factory will build heavy-duty double-column machining centers, horizontal machining centers, and horizontal boring-milling machines when it is completed in late 2015. Construction is to begin by the end of this month.

The Goodway Group, which is composed mainly of the parent Goodway Machine Corp. and its subsidiary Awea Mechantronic Co., broke ground in November on a 9,900-square-meter site at the Chiayi Dapumei Intelligent Industrial Park in southern Taiwan, marking the inauguration of an investment plan involving two new factories. The new facility will manufacture double-column machining centers and vertical machining centers when it is completed in 2016.

The first factory will cost the group around NT$500 million (US$16.6 million) to build (with construction scheduled to begin early next year) and NT$1 billion (US$33.3 million) to tool-up. The two factories together are projected to generate consolidated annual revenues of NT$2.5 billion (US$83.3 million) in the initial stage, with the first one accounting for around half. This will double the group's total revenue to around NT$5 billion (US$166.6 million) a year.

Awea executives point out that in addition to the new factory, the company will spend tens of millions of NT dollar next year to boost the capacity of its manufacturing site in Hsinchu, northern Taiwan.

The Kao Fong Machinery Co. has begun tooling up a new factory in the Central Taiwan Science Park to make heavy-duty double-column machining centers; completion is expected by the Chinese New Year next February. The new factory, which is projected to generate revenues of NT$1 billion (US$33.3 million) a year initially, is costing the company NT$360 million (US$12 million).

Also, the company will build a factory in the Chiayi Dapumei industrial park at cost of around NT$200 million (US$6.6 million) to make components for its parent firm, the Hota Industrial Mfg. Co. Construction will begin by the end of this year and by completed by the end of 2015. (KL)


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