Teco Electric and partners to build a factory in China

Teco Electric & Machinery Co (東元電機), Taiwan's largest maker of industrial motors, will build a US$20 million electric motor plant in China with partners China Steel Corp (中鋼), Nippon Steel Corp, Marubeni-Itochu Steel Inc and Sumitomo Corp.

Teco, which celebrated its 46th anniversary on Saturday, will hold 70 percent of the venture, China Steel and Nippon Steel will each hold 10 percent while Marubeni-Itochu and Sumitomo will jointly hold another 10 percent, Teco said in a statement. The new plant will start operation by next March.

"The plant will focus on export in the initial stage and in the long-term, we hope to expand in China through acquisitions," said Senior Vice President Sophia Chiu (邱純枝).

Taiwan companies have been shifting production to China, the island's political rival, to take advantage of lower land and wage costs in China.

Taiwanese companies' investment in China, Asia's fastest-growing economy, rose 26 percent in the first nine months from a year earlier.

In contrast, foreign direct investment in Taiwan fell 43 percent.