TYC Brother Industrial Co (堤維西), which makes lighting products used in vehicles, plans to spend NT$150 million (US$5 million) this month on building a factory for making original equipment manufacturing (OEM) products for cars.
On Thursday next week, TYC is to break ground for a two-floor factory on 2,300 ping (7,600m2) of land in the Southern Taiwan Science Park (南部科學工業園區).
The capacity expansion project, which is TYC’s first in the past 12 years, is expected to be completed by the end of this year, chairman Wu Chun-chi (吳俊佶) told reporters yesterday.
Because of capacity constraints amid growing demand, the company has had to extend the delivery time of its products to 40 days, up from 21 days on average, Wu said.
He said the company would relocate its production lines for OEM products to the new site, freeing part of the space at its current factory in Greater Tainan for capacity expansion to accommodate growing demand for its aftermarket products.
Once the expansion project is completed, TYC’s Greater Tainan factory is to manufacture aftermarket automobile lamps, while its new factory in the science park will make OEM products, Wu said.
“We need to lower costs for our aftermarket products, while raising the quality of our products in the OEM market and delivering them to our clients on time,” Wu said.
TYC will also relocate its subsidiary Juoku Technology Co (儒億科技), which makes parts of automobile lamps for TYC’s OEM business, close to the new factory between August and September, Wu said.
TYC holds a 76.8 percent stake in Juoku, it said.
Currently supplying OEM products to Bayerische Motoren Werke AG (BMW) for Mini Cooper cars and lamp maker Osram GmbH, the company aims to increase sales in the OEM market to NT$200 million a year within the next three years from the current NT$150 million a year, Wu said.
From January through last month, the company posted revenue growth of 16.99 percent to NT$7.79 billion, up from NT$6.66 billion the previous year.
The company aims to see revenue increase by 20 percent this year.
Net profit was NT$154.91 million, or NT$0.5 per share, in the first quarter of the year, up 85.52 percent from NT$83.5 million, or NT$0.27 per share, a year ago.
TYC has set a target to report pretax profit of NT$2 per share this year.
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