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Taiwan`s First Digital Tool Maker Gears Up for Mass Production
2007/08/09
With nearly a million U.S. dollars worth of trial orders from European, American, and Japanese buyers flooding in in April alone, Li Ming-hua, general manager of the Eclat-Torq Technology Co., is confidently predicting sales of NT$80 million (US$2.4 million) this year and NT$150 million (US$4.5 million) in 2008.
 | | Li shows off his digital tools. |
Eclat-Torq was established late last year as an NT$95 million (US$2.8 million) joint venture by more than 10 of Taiwan`s hand-tool makers along with the Mechanical Industry Research Laboratories (MIRL), a unit of the government-backed Industrial Technology Research Institute (ITRI). The corporate investors include the Infar Industrial Co., K&W Tools CO., Proxene Tools Co., Savco Corp., Sound Han Industrial Co., Tong Lee Industrial Co., William Tools Co., J&K International Co., Yih Cheng Factory Co., and Re-Dai Precision Tools.
The startup is aimed at helping to boost the value of Taiwan-made tools and differentiate them from low-priced products. The core of the company`s digital tools is a nail-sized digital meter produced under the micro-electromechanical system (MENS) approach. "Our meter is not the ordinary digital gauge that you`ve seen with other products," Li stresses. "It is able to precisely measure torque force, tension force, temperature, and even the number of calories a tool user burns on the job."
The company itself produces the gauge, which incorporates signal-sensing, data processing, and digital-display capabilities. In the first half of this year wrenches remained the main tools incorporating the device, but in the second half the firm will build it into its pullers and screwdrivers. Also, Li adds, "We may introduce digital power tools in three years," adding that digital devices have a wide range of applications and that, after adapting them to power tools, the company will likely build them into consumer electronics products.
Li himself is a spinoff from MIRL`s Precision Machines and Control Technology Division, where he was in charge of the digital-tool technology program. He recalls that the development of the technology began around 2001 on commission by the Industrial Technology Department of the Ministry of Economic Affairs.
The Practicality of Digital Meters
"We identified this technology because no other country had ever developed a miniature electronic meter like ours for hand tools," Li recalls. "Digital meters have a practical side, mainly because they are more accurate than mechanical devices when used with some tools."
The president estimates that the prices of his digital tools will be 20-30% lower than those from Western manufacturers. The gauge, he believes, adds only 10-20% to a tool`s cost. That is a mere NT$16 to NT$20.
Li estimates global consumption of digital tools at around US$909 million annually, with the main suppliers being Snapon of the United States, KTC of Japan, and Gedore of Europe. He claims, however, "Most of their products are massive in size, are not very reliable when installed with conventional electrical circuits."
Eclat-Torq recently moved from an incubator center in MIRL`s Taichung building to a 21,600-square-foot factory in the Taichung Export Processing Zone, where it will double its monthly output to 4,000 units by adding another production line. "We`re ready for volume production right now," Li claims, "but we`re not running at full capacity yet because customers are still testing our products. Once they approve, we`ll go ahead full throttle."
Asked whether such a delicate-looking gauge can withstand a heavy impact like that which might result from a fall, Li replies that it has passed at least 95% of all required tests including impact, acid corrosion, waterproofing, vibration, quake-resistance, heat-resistance, oil-proofing, and electromagnetic interference.
MIRL believes that digital tools will give a strong boost to the island`s hand-tool industry, and predicts that digitization will add NT$35 million (US$1.06 billion) to Taiwan`s hand-tool revenues in 2009, boosting the figure past the NT$100 billion (US$3 billion) mark. Li hopes that these tools will also help boost Taiwan`s share of the global hand-tool market to 40%, double the current ratio of 20%.
The president believes that high-value-added products like digital tools will help Taiwanese producers gain back some of the market share they have lost to mainland Chinese suppliers. China replaced Taiwan as the world`s No. 1 hand-tool exporter in 2003, exporting US$1.38 billion worth of the products, compared to Taiwan`s US$1.29 billion.
The new digital tool was warmly welcomed when it debuted at a hardware fair in Las Vegas last year, where representatives from major suppliers including E.C. Barton, ACE, Home Deport, Assured Imports, Amazon, Orchard Supply Hardware, K-Mart, and Sears visited the booth. E.C. Barton even promised to send a delegation to Taiwan last October to talk about procurement deals.
Charles Hsieh, chairman of the Taiwan Hand Tool Manufacturers` Association, said that Taiwan`s digital tools proved to be star products at a hardware trade show held in Cologne last March.
Li`s expectations for his digital gauge do not end with hand tools. "This technology can be developed into an independent industry," he enthuses. "It can be used by all machines that need a sensing function, like fitness equipment."
(by Ken Liu)
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