With the spread of severe acute respiratory syndrome (SARS) lingering on, many Taiwanese electronics manufacturers began to develop back-up plans to diversify their overseas production to reduce risks, according to a poll by the Council for Economic Planning and Development (CEPD).
The poll, which was conducted by the DigiTimes on April 30 and was commissioned by CEPD, showed some local manufacturers said they may shift some of their production in China to Taiwan, while some others said they may increase production in Eastern Europe.
The DigiTimes polled 300 executives of electronics manufacturers from 16 industries on their contingency plans after SARS began to spread throughout Asia.
The poll also showed that Taiwanese makers are concerned about international buyers shifting orders to the nation's regional competitors. Several computer motherboard makers that have operations in China said they may lose orders to their South Korean counterparts if they don't increased production in Malaysia and Mexico to assure supply chains remain unchanged.
But handset printed circuit board makers said they have seen international buyers begin to shift orders to either US or Japanese rivals lately, according to the poll.
While few companies are reporting manufacturing slowdowns or stalled product launches, several Taiwanese manufacturers fear SARS could lead to disruptions in the supply chains within China and have reconsidered the risk of concentrating their investments there, said Ho Mei-yueh (
Last week, several leading manufacturers of notebooks, motherboards, and electrical machinery -- including Quanta Computer Inc (廣達電腦), Inventec Co (英業達), Asustek Computer Inc (華碩電腦) and Teco Electric & Machinery Co (東元電機) -- said they may postpone investment projects in China because of the SARS outbreak.
Teco, the nation's largest maker of industrial motors, may slowdown a planned NT$1 billion investment in China, chairman Theodore Huang (黃茂雄) said earlier last week. A local Chinese-language newspaper reported that Teco may move the project to Subic Bay industrial park in the Philippines, but Huang denied the reports.
Given cost considerations, most of Taiwan's computer and electronics makers have moved their production or assembly lines to China over the past decade. Taiwan businesses in China contributed 64 percent of the production value of the mainland's information industry last year (US$22.53 billion) according to government statistics.
Industry sources said Quanta, Inventec and Asustek are seeking to diversify their overseas investments by modeling the experience of Hon Hai Precision Industry Co (
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is