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Tongtai Works with AIDC to Develop 5-Axis Machining Center for Aircraft Building

Aug 23, 2015 | By Ken Liu

Tongtai Chairman J.H. Yen. Tongtai Chairman J.H. Yen.
In an effort to move upmarket, Tongtai Machine & Tool Co., Ltd., one of Taiwan's leading machine-tool makers, is aggressively developing five-axis machining centers for the aircraft-building industry in cooperation with the aircraft builder Aerospace Industrial Development Corp. (AIDC) of Taiwan.

Industry executives estimate aviation-industry machine tools to increase to account for 5 percent of the company's sales by the end of this year from the current 3 percent.

The company has recently signed a contract to supply AIDC six five-axis machining centers valued at around NT$240 million (US$7.5 million) and will begin to fill the order next year.

Earlier, the company won a contract to supply AIDC eight machines valued at about NT$320 million (US$10 million), which will help boost the company's gross margin when the company begins to deliver the order in the final quarter of this year.

Tongtai Chairman J.H. Yen points out that his company has worked with AIDC for many years, giving his company first-hand knowledge of the mechanical specifications AIDC prefers. In addition, the company has the advantage of proximity, with its headquarters located in Luchu Dist., Kaohsiung of southern Taiwan, which is close to AIDC's headquarters in Gangshan Dist. of the same city, enabling the company to offer tech support efficiently and quickly.

Yen says his company is providing tailor-made equipment that helps AIDC boost production efficiency by 20 percent relative to competing equipment from foreign suppliers, adding that entering the equipment market for the aviation industry helps elevate the status of Taiwan's machine-tool industry, which is currently focused on machines for the automotive and motorbike industries.

Industry executives point out that the company is set to boost its manufacturing capacity for aircraft-building machine tools next year when its phase-one construction of a new factory located right across its Luchu headquarters will be completed in the second quarter.

The chairman points out that many of his company's subsidiaries, including Honor Seiki Co., Ltd. and Asia Pacific Elite Corp., have sold machine tools to aircraft builders worldwide, stressing that Tongtai will continue integrating its manufacturing capability for aircraft-building machine tools with its subsidiaries to increase the contribution of such machines to the group's revenue.

AIDC has been keen to increase outsourcing since it was privatized last year, thereby providing lucrative business opportunities to aircraft subcontractors and machine-tool suppliers on the island. Industry executives estimate AIDC's contracts to create business valued at least NT$30 billion (US$937.5 million) over the next two years for local manufacturers, especially considering that the company has promised to designate local machine-tool makers as prioritized suppliers.

Besides Tongtai, 10-plus local machine-tool makers, including Goodway Machine Corp., AWEA Mechantronic Co., Ltd., Kao Fong Machinery Co., Ltd., Falcon Machine Tool Co., Ltd., the Fair Friend Enterprise Group, and Chung Hsin Electric & Machinery Co., Ltd., have formed a consortium to develop aircraft-building machine tools, including five-axis machining centers, gantry-type machining centers, and vertical-type lathing-milling combos.


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