Tong Yang Ready for Recovery with Expanded Capacities in Taiwan and China

Taipei, July 4, 2012 (CENS)--Tong Yang Industrial Co., Taiwan's largest auto-parts maker, recently claimed that after a series of capacity expansions have been completed, the firm is ready for the next wave of strong global demand, said chairman Michael Wu at the recent shareholders meeting.

Wu believes the global auto-parts market has bottomed and is expected to recover, adding that the maker has been expanding capacities in Taiwan and China as well as setting up subsidiaries or joint ventures (with Chinese automakers), with more capacities to be added over the next two years.

Crispin Wu, Tong Yang's president, said in the third quarter of 2011 when he took over as president, that the Chinese government will push another wave of subsidies to stimulate the automotive industry in China, with these programs expected to trigger stronger demand in the second half of 2012.

Natural disasters, he explained, such as the massive earthquake and tsunami in Japan, as well as floods in Thailand, have been driving Japanese automakers to outsource auto-parts orders to overseas suppliers, with an estimated 20% of such orders to go to Taiwan. So, Tong Yang is ready to take more OE parts orders after installing new coating lines at its factory in Guanyin, Taoyuan County, northern Taiwan, and renovating its plastic injection facility in Tainan, southern Taiwan.

Tong Yang's three new reinvestment projects in China, including joint ventures in Changsha of Hunan Province, Foshan of Guangdong Province and Xiangyang, Hubei Province, are scheduled to kick off mass production between the second half of 2012 and end of 2013.

The president also said that China will be the largest market for aftermarket (AM) auto parts, so Tong Yang has kicked off mass production of AM items at its Chinese subsidiary Nanjing Tong Yang Plastics Co., Ltd., as well as developing sales channels and building brand image.

Auto parts are eligible for zero duties starting in 2012 under the Economic Cooperation Framework Agreement (ECFA) between Taiwan and China.