Tong Yang Industry Co (東陽實業), one of the world’s largest aftermarket automotive component suppliers, yesterday posted an 8.8 percent annual decrease in net profit for the first half of this year due to slowing demand from US customers and higher material costs.
Pre-tax profit in the first half of the year fell to NT$1.36 billion (US$44.48 million) from NT$1.48 billion in the same period last year, the company said in a filing.
From January through last month, cumulative revenue totaled NT$12.05 billion, edging up 0.75 percent from NT$11.96 billion in the first half of last year.
“Some customers from Europe and the US were more hesitant to place orders for aftermarket car parts last quarter, as they have yet to finish inventory digestion,” a Tong Yang official said by telephone.
Despite the annual decline in its bottom line, Tong Yang said that it remains optimistic about its business outlook for the coming quarters, backed by growing original equipment manufacturing (OEM) activity in China.
The Tainan-based company is to supply lightweight plastic components used in new electric cars made by benchmark Chinese brands including Guangzhou Automobile Group (廣汽集團), Dongfeng Motor Corp (東風汽車) and Changan Automobile (長安汽車), it said.
Tong Yang said it aims to further increase its presence in China’s new-energy vehicle market by expanding capacity through an alliance with one of its major clients, Changchun Faway Automobile Components Co (一汽富維).
New plants in Qingdao in China’s Shandong Province and Tianjin in Hebei Province began trial production last quarter, each with an annual design capacity to produce components for 300,000 cars, the company said.
The firm said it expects the two new facilities to run at full capacity by the end of the year at the earliest.
The escalating US-China trade war is not expected to have any significant impact on Tong Yang’s business, as the company has a diversified customer base with more than 2,300 foreign customers, company president Yung Hsiang (吳永祥) said in a statement.
Yuanta Securities Investment Consulting Co (元大投顧) shared the company’s outlook, saying that potential US tariffs and possible retaliatory tariffs from other governments could harm global demand for cars, but the impact on local auto parts supply chains should be limited.
Taiwanese suppliers’ customer bases are mostly diversified and many have followed their clients’ localization strategies to reduce risks, Yuanta said in a client note last month.
Tong Yang shares yesterday fell 0.78 percent to close at NT$44.35 on the main board after the earnings announcement, underperforming the broader market’s 0.43 percent decrease.
Napoleon Osorio is proud of being the first taxi driver to have accepted payment in bitcoin in the first country in the world to make the cryptocurrency legal tender: El Salvador. He credits Salvadoran President Nayib Bukele’s decision to bank on bitcoin three years ago with changing his life. “Before I was unemployed... And now I have my own business,” said the 39-year-old businessman, who uses an app to charge for rides in bitcoin and now runs his own car rental company. Three years ago the leader of the Central American nation took a huge gamble when he put bitcoin
Demand for artificial intelligence (AI) chips should spur growth for the semiconductor industry over the next few years, the CEO of a major supplier to Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said, dismissing concerns that investors had misjudged the pace and extent of spending on AI. While the global chip market has grown about 8 percent annually over the past 20 years, AI semiconductors should grow at a much higher rate going forward, Scientech Corp (辛耘) chief executive officer Hsu Ming-chi (許明琪) told Bloomberg Television. “This booming of the AI industry has just begun,” Hsu said. “For the most prominent
Former Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman Mark Liu (劉德音) yesterday warned against the tendency to label stakeholders as either “pro-China” or “pro-US,” calling such rigid thinking a “trap” that could impede policy discussions. Liu, an adviser to the Cabinet’s Economic Development Committee, made the comments in his keynote speech at the committee’s first advisers’ meeting. Speaking in front of Premier Cho Jung-tai (卓榮泰), National Development Council (NDC) Minister Paul Liu (劉鏡清) and other officials, Liu urged the public to be wary of falling into the “trap” of categorizing people involved in discussions into either the “pro-China” or “pro-US” camp. Liu,
Minister of Economic Affairs J.W. Kuo (郭智輝) yesterday said Taiwan’s government plans to set up a business service company in Kyushu, Japan, to help Taiwanese companies operating there. “The company will follow the one-stop service model similar to the science parks we have in Taiwan,” Kuo said. “As each prefecture is providing different conditions, we will establish a new company providing services and helping Taiwanese companies swiftly settle in Japan.” Kuo did not specify the exact location of the planned company but said it would not be in Kumamoto, the Kyushu prefecture in which Taiwan Semiconductor Manufacturing Company (TSMC, 台積電) has a
RSS