By Kent Miller
CORRESPONDENT
Published: October 14, 2014 6:00 am ET
Updated: October 14, 2014 11:35 am ET
Image By: Kent Miller
Allen Lin and Teresa Wang of We Technology Automation Co. Ltd.
TAIPEI, TAIWAN — Taiwanese automation specialist We Technology Automation Co. Ltd. plans to build a factory in Ningbo, China, with an eye to quenching the strong cross-straits appetite for robots.
Mounting labor costs and concerns about capacity and quality control are propelling mainland interest in automation.
Scheduled to start production in the second half of 2015, the factory will have a production capacity of 200 robots per month, Wetec director Allen Lin said at the Taipei Plas trade show.
Cost and size of the factory have not been finalized, but Lin said it will employ about 120. Research and development will remain in Taiwan, Lin said.
Wetec plans to partner with other companies to serve China’s strongest sectors. “In China, automotive is a very big industry,” Lin said.
Currently, Wetec’s Taoyunan factory produces about 50 units a month, including robots, an in-mold labeling system, a PET post-mold cooling system and a 32-cavity cutlery-maker, Lin said. Control systems will also continue to be made in Taiwan.
The closely held company declined to discuss sales figures. However, Lin said that U.S. sales, negligible in 2012, now represent about 15 percent of Wetec’s annual total.
Wetec has especially high stateside hopes for its in-mold labeling systems. Compared to Asia, where the technology is popular for consumer packaging, IML has scarcely penetrated the U.S. market, Lin said.
The Ningbo facility marks a dramatic re-entry into the Chinese market for the 28-year-old automation specialist, which by mutual agreement terminated a partnership with a Dongguan factory on Jan. 1. Wetec’s Chinese partner wanted to start up its own brand, said marketing director Teresa Wang.
Wetec will also set up a Shanghai sales and service office in early 2015.
Last year, Wetec opened a European branch in Istanbul.
Image By: Kent Miller
Victor Lim
Even though Wetec underprices Japanese and European competitors by 15 to 20 percent, its gear is smaller, lighter and easier to maintain, Wang said.
In other automation news, construction delays have pushed back the opening of automation vendor Forwell Precision Machinery Co. Ltd.’s factory in Huai’an, Jiangsu province, to the end of this year, acting general manager Victor Lim said.
The $10 million, 387,000-square-foot research and manufacturing facility had been slated to open at mid-year. It will employ about 200.
Despite the hiccup, Forwell remains bullish on the Chinese market, although a previously planned initial public offering on a mainland exchange won’t happen before 2017.
Forwell already has a Chinese factory in Ningbo, a center of the plastic production-equipment industry.
Propelled in large part by the Chinese market, Forwell’s sales are up about 10 percent this year.
Lim demonstrated a rail-mounted automatic mold storage system, which aims to ease the handling and storing of pricey but hefty molds. The device is slated to be available by the end of December.
Forwell’s next big push will be into India, Lim said. “Even though the labor costs there are low, quality control is an issue there.”
Forwell realizes about 60 percent of its sales from gear that automates the injection-molding process. Other sales are in metal forming.
Demand for reliable output is fueling demand even in Southeast Asian countries with lower labor costs, said Tenso Machinery Industrial Co. Ltd. sales manager Faber Jeng.
“When the customer invests in robots, they maintain good quality control,” said Jeng. Tenso’s leading markets are Indonesia and Thailand, Jeng said.
With its stable Taiwanese workforce, Tenso is reluctant to move production into China, Faber said.
“It’s not so easy to set up factories there to produce robots,” Faber said.
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