The Tainan City Government has approved Tong Yang Industry Co’s (東陽實業) application to purchase a plot at Qigu Technology Industrial Park (七股科技工業區), the automotive metal sheet and bumper maker said yesterday.
The company plans to acquire the 15,105.16 ping (49,934.49m2) plot for NT$997.07 million (US$30.8 million) to construct a new plant to produce aftermarket auto components, Tong Yang said in a regulatory filing.
The deal comes after Tong Yang late last year purchased a 4,879.19 ping plot at Tainan Technology Industrial Park (台南科技工業區) for NT$595 million, as the company continues to expand its aftermarket business. It has undergone a steady recovery in the North American market since last year due to insurance companies expanding coverage to aftermarket collision parts such as fenders, grilles and metal plates.
Photo: CNA
Tong Yang, a leader in the global plastic parts and sheet metal parts aftermarkets with market shares of 70 percent and 35 percent respectively, said that orders have continued to grow, even as the industry enters a low season in the second quarter.
The company plans to speed up the construction of new production lines and manufacturing to meet its operational needs and market demand, it said.
Tong Yang supplies auto components for global brands through original equipment manufacturing (OEM) or the aftermarket channel.
The company has budgeted NT$4.2 billion for capital expenditure this year, it said.
The latest expansion would increase its bumper production capacity 5 percent, plastic front rail production capacity 33 percent and sheet metal fender production capacity 6 percent annually, Tong Yang said.
The company yesterday also released earnings results for the first quarter, with net profit soaring 139 percent year-on-year to NT$1.17 billion, a record high.
Earnings per share were NT$1.98, compared with NT$0.83 a year earlier, it said.
Cumulative sales in the first four months of the year rose 12.6 percent annually to NT$8.28 billion, the highest for the four-month period, as aftermarket sales increased 17 percent to NT$6.2 billion, while OEM sales edged up 1 percent to NT$2.08 billion, it said.
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