Industrial PC maker Ennoconn Corp (樺漢科技), a subsidiary of Hon Hai Precision Industry Co (鴻海精密), yesterday outlined plans to tap the Chinese market as Beijing pushes sweeping economic plans.
The company has established a subsidiary headquartered in Kunshan, Jiangsu Province, to oversee expansions of sales and services channels across China, from the nation’s major cities on the east coast to major industrial hubs in inland provinces, Ennoconn chief operating officer Steve Chu (朱復銓) told an investors’ conference in Taipei.
The company’s presence in Kunshan would also include a research and development center, an industry incubator, demonstration sites for the firm’s Internet of Things, “smart” manufacturing and assembly solutions, as well as global data and logistics centers, Chu said.
As Beijing continues to implement its “Made in China 2025” strategy aimed at transforming the nation into an advanced manufacturing economy, the company is ready to satisfy demand for new Industry 4.0 and “smart” factory solutions, in particular among the country’s small and medium-sized enterprises, Chu said, adding that the company would work with Foxconn Industrial Internet Co (富士康工業互聯網), another Hon Hai subsidiary that has been granted expedited listing on the Shanghai Stock Exchange.
“We want to offer a strong value proposition to the Chinese market that is enhanced by our combined resources with Foxconn Technology Group,” Chu said.
While only 11 percent of the company’s sales last year came from Asia, including China and Japan, Chu said that China would become the firm’s main market, along with the US and Europe, which accounted for 47 percent and 39 percent of sales respectively.
He also emphasized the company’s plans to expand beyond its role as a hardware supplier and become a systems and solutions provider, saying that Ennoconn has almost finished acquiring all the necessary technology to do so through a series of investments and holdings, including semiconductor equipment supplier Marketech International Corp (帆宣).
The company would also continue seeking higher margins through sales of branded products following its acquisition of Kontron AG — a German maker of embedded computer modules, boards and systems — which it controls through its 28.45 percent-owned subsidiary S&T AG.
While S&T is expected to contribute more than 1 billion euros (US$1.24 billion) in sales this year, the German subsidiary’s products enjoy considerably higher margins of between 30 and 45 percent compared with Ennoconn’s original design manufacturer business, Chu said.
Even without a boost from S&T, Ennoconn has posted robust organic growth on its own, Chu said.
However, the company is in the process of integrating its recent investments and that it would not be making major moves in the near future, Chu said.
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