Bidding continues for Yulon project

Yulon Motor Co (裕隆汽車), which assembles and sells cars in Taiwan for Nissan Motor Co, said yesterday that the bidding for its lucrative land development project was continuing and a final decision would be made around June.

"We are still talking to a number of bidders for the project ... The winning proposal will best serve the interests of both parties," Yulon Motor president Chen Kuo-rong (陳國榮) told reporters on the sidelines of a ceremony marking the start of construction yesterday.

Yulon Motor's development of an abandoned factory site into a residential and commercial complex in Sindian City, Taipei County, has lured a number of interested developers.

Expected developers

The media has earlier reported that Ruentex Development Co (潤泰創新國際) and Yuanta Construction Development Co (元大建設) will most likely win the project, but Chen said that conclusions on the bidding would not be finalized until the middle of next year due to revisions in guidelines for bidding on projects.

According to Yulon Group (裕隆集團) chairman Kenneth Yan (嚴凱泰), the project development is estimated to be worth NT$50 billion (US$1.5 billion).

Project description

The land development project allots 40,000 pings (3.3m2) for residential use and 60,000 pings for commercial development.

Construction will begin at the end of next year on the commercial complex.

Construction started yesterday on a 10,000-ping public park that is also included in the land development project.

Channeling profits

Yulon Motor hopes to channel profits from the land development project into its core business of auto manufacturing, Chen said.

"Real estate is not our main business, but revenues from these office buildings and hotel development will ensure a smooth cash flow," he said.

Affected by lackluster local auto sales, Yulon Motor last month lowered its revenue forecast for this year to NT$26.8 billion (US$819.4 million) -- a 41.7 percent cut from its earlier projection.

Its income forecast was also slashed to NT$4 billion from NT$5 billion.

The company's shares closed down 1.9 percent to NT$41.2 on the Taiwan Stock Exchange yesterday.