Tatung to Build Electric Motor Factory in Shenyang

The Tatung Group, one of Taiwan's largest manufacturers of heavy electrical machinery and home appliances, recently announced plans to invest US$3 million in a new joint-venture plant for the production of high-voltage alternating-current (AC) electric motors in mainland China. The plant will be built in Shenyang, Liaoning Province, in cooperation with Shenyang Electric Machine Co., the mainland's third-largest manufacturer of medium- and large-sized motors.

Tatung is to control 51% of the joint venture, which is set to begin pilot production in mid-2004. This is the company's first foray into the market in northeastern China, and into the production of medium- and large-sized motors.

A listed company on the Taiwan Stock Exchange, Tatung has submitted its mainland investment plan to the Investment Commission of the Ministry of Economic Affairs (MOEA) for review in compliance with the government's mainland China investment policy.

Shenyang Electric Machine was set up in 1950 as a state-run enterprise and specializes in low- and high-voltage synchronous and asynchronous AC motors. It currently has a work force of 1,800, including an engineering and technical staff of 300. Its products are exported to more than 40 countries.

The joint-venture company is projected to achieve sales of NT$200 million (US$5.9 million) in its first year of operation, and to double that amount in the second year. Part of its business is expected to come from electric-power plant construction projects on the mainland.

Tatung earlier announced plans to set up a plant to produce electric wires and cables in Jiangsu Province.

At present, the Taiwanese company turns out a wide range of products in the heavy electrical machinery line, including small- and medium-sized motors, power generators, electric wires and cables, and transformers. The Shenyang venture's high-voltage motors will augment the product line and give Tatung a foothold in the mainland's lucrative market.

Shenyang Electric Machine will also benefit by gaining access to Tatung's well-established international marketing network.