Auto parts makers up exports, strive to boost competitiveness

By Karen Huang, The China Post

While the slowing world economy is stopping consumers from buying new cars, sales of made-in-Taiwan auto parts for the replacement market are expected to register growth of 30 percent.

With an eye on keeping the leading edge, local manufacturers of auto parts have adopted various strategies to expand their markets. Gordon Auto Body Parts Co., for example, has been setting up overseas marketing offices to increase its market shares in Latin American countries such as Mexico and Puerto Rico.

Another strategy for enhancing competitiveness is to develop new high precision molds in cooperation with strategic appliances. This is the strategy taken by Taiwan Kai Yih Industrial Co., Ltd. (TKI), an affiliated company of Tong Yang Group. While joint development of molds not only helps lower operating costs substantially, but also dilutes vicious price cutting among the auto part suppliers in Taiwan.

The channels and brand name of Tong Yang Group add other advantages to TKI.

The ability to provide a full product line of auto parts makes TKI a favorable source of overseas buyers of auto parts.

Backed by a full product line of more than 10,000 items in auto parts, Tong Yang Group now operates with over 1,500 direct retail outlets and 403 distributors in 170 countries worldwide. Tong Yang said that the wide scope of its product lines is an advantage that other competitors could not overtake in a short period of time. As the production scale of local auto part makers gets bigger and bigger, the development of export market is crucial for the survival of Taiwan auto parts makers. Jui Li Enterprise benefits from rapid growth of export orders, especially from North America. The company in the past focused its sales of its sheet metal parts on the domestic market. However, it started exports to the overseas replacement markets last year. The export drive of Jui Li has yielded satisfactory results. Now 30 percent of its production is for export markets.