Seven flat-panel machine makers form an alliance

Representatives from Taiwanese flat-panel equipment makers Mirle Automation Co, Gallant Precision Machining Co, Hiwin Mikrosystem Co, CSun Mfg Ltd, Usun Technology Co, Mactech Co and E-Sun Precision Industrial Co shake hands at a press conference in Taipei yesterday after forming an alliance to develop advanced and cost-saving equipment for local panel makers. PHOTO: CHEN MEI-YING, TAIPEI TIMES

Seven Taiwanese flat-panel equipment makers yesterday formed an alliance to develop advanced and cost-saving equipment for local panel makers, aiming to grab a bigger slice of the nation's NT$140 billion (US$4.25 billion) equipment market.

The alliance is targeting the fast-growing, big-sized thin-film transistor liquid-crystal-display (TFT-LCD) business, as domestic flat-panel makers led by AU Optronics Corp (AUO, 友達光電) are building next-generation plants to process glass substrates as big as 1,950mm x 2,250mm.

"We think we have bigger business opportunities now as panel makers will find it increasingly hard to import huge equipment by air, which is expensive," Mirle Automation Co (盟立) chairman Sun Houng (孫弘) said.

Sun is also the chairman of the newly established alliance.

Mirle Automation supplies equipment such as robot applications used in the manufacturing of flat panels for customers like AUO.

Taiwanese TFT-LCD panel makers spent NT$140 billion in new equipment last year, statistics compiled by the Ministry of Economic Affairs showed.

The government is helping local equipment makers capture a bigger share of the market by providing the alliance with a subsidy of NT$86 million in the initial stage.

At the same time, it hopes to help local flat-panel makers reduce their cost by encouraging them to buy locally made equipment to fend off competition from South Korean companies.

Approximately 30 percent of the equipment currently used by local flat-panel makers were made by Taiwanese companies. The government aims to increase the proportion to 40 percent this year and 50 percent next year.

Gallant Precision Machining Co (均豪精密) chief executive Nick Yeh (葉勝發) used the machine used to cut glass substrates after being tested as an example.

Four years ago, a cutter made by Japanese companies cost local panel makers NT$26 million, he said, but the price has plunged to NT$6 million after local makers became the major supplier of the equipment.

Panel makers agree, with Hwang Liwei (黃立維), a special assistant at AUO's manufacturing section, saying: "We have significantly reduced cost by shifting to local firms for equipment supply."

Hwang added that AUO planned to gradually increase its procurement ratio of equipment made by Taiwanese companies.

The seven companies plan to pool their resources and invest NT$174 million to develop technologies to make advanced equipment for flat-panel makers.

Aside from Mirle Automation and Gallant Precision, the other members of the alliance are Hiwin Mikrosystem Co (大銀微 系統), CSun MFG Ltd (志聖工業), Usun Technology Co (陽程工業), Mactech Co (韶陽科技) and E-Sun Precision Industrial Co (億尚精密).