New Kailung Gear Co., Ltd. (NKL), a long-established name in precision-gear manufacturing, is now making a difference in a new field--all terrain vehicle (ATV) differential gear cases, both on the manufacturing and design and system integration sides.



"NKL is not just a gear manufacturer or precision-gear processor," claims company general manager J. C. Liu, "We are a comprehensive product design company with core techniques in gears."

The successful and substantial transformation of NKL happened over a long period and culminated in late 2006 with the announcement of a family of high-precision differential gear cases for ATVs, utility vehicles (UTVs, or side-by-sides), and other lightweight vehicles with engine displacements ranging from 300cc to 950cc. The attractive designs of the differentials are matched by equally impressive functions, including globally-patented modularized systems for two/four-wheel-drive (2WD/4WD), limited slip differential (LSD), and 2WD/4WD locking for both manual and electronic controls.

The product family of about 15 differential models in four major type (function) categories have raised NKL`s profile in the powersports parts industry in Taiwan. The company now supplies almost all of the big-bore ATV manufacturers on the island. And this is just a start, the company claims.

According to Liu, NKL will introduce a series of very cost-competitive differentials for UTVs this year. The new components achieve their price advantage by using a modularized design and drawing on NKL`s core know-how in system design and streamlining manufacturing processes.

The Cost Advantage

"We have the highest confidence that NKL will be the best partner for all ATV and UTV manufacturers worldwide," Liu claims. "Key differential systems are too costly and time consuming for manufacturers to produce in-house, so it just makes sense to contact the business to a specialized supplier. That`s why all leading ATV brands worldwide outsource their gearbox and differential systems."

Cost is one of the most important concerns for producers outsourcing high-quality differential systems, which enable ATVs or UTVs to adapt to different road conditions. Liu says NKL`s high-end components can help customers cut costs and shorten production time.

NKL has been trying hard to find new ways to upgrade its manufacturing techniques and processes to cut costs and improve quality and precision by partnering with satellite plants, research institutes, and universities, Liu explains. The company`s goal is to become the most cost-competitive ATV/UTV differential developer and maker in the world.

NKL is the first company using cold-forging methods to produce precision gears for differential systems. This process slashes production time and cuts costs by 30%. Cold-forged gears are stronger than hot-forged counterparts, though the technical thresholds in product- and die-designs for such items is quite high.

Another advantage enjoyed by NKL is its R&D achievements in ATV/UTV differentials. The company has registered over 20 global patents and developed a comprehensive product family that can meet the market development trend over next three years at least.




"We have developed all of the required systems and sub-systems for ATV/UTV differential systems in modularized formats and patented them worldwide," Liu claims. "That means NKL is ready to pull ahead of the overall industry development and launch several `next-step` projects, such as the electronic-control differential systems and other even-more advanced modules."

In fact, NKL announced its product family in late 2006 after a period of about four years in which the firm was commissioned by Taiwan`s largest powered two-wheeler (PTW)/ATV maker Kwang Yang Motor Co., Ltd. (KYMCO) to develop and supply a series of differentials for large engine-displacement ATV models, which have been selling strongly in Europe.

Everything supplied by NKL is ready to be commercialized and the firm`s modularized design concept speeds up the development time for a new differential and related sub-systems to just 45 workdays from concept to test-ready prototype. "That`s one of NKL`s core competitive advantages," Liu claims, "Over the past three years, our company has totally transformed from merely an OEM or first-tier differential supplier into a fully integrated firm with competencies in product design, manufacturing, and overseas marketing. Currently, 15% of NKL`s 100 employees are high-level R&D staff, and the ratio is expected to rapidly increase as manufacturing is no long the focal point at our company."

NKL`s successful transformation into a technology-driven enterprise has been achieved by the strong support of the company`s high-quality, technically advanced satellite plants, says Liu. These plants are constantly upgrading their manufacturing techniques and provide enough capacity to meet urgent and big-ticket orders. NKL`s long-established supply-chain on the island, according to Liu, helps the company cut operation costs, upgrade production flexibility, and continue benefiting from Taiwan`s superior labor and development resources. "With the joint efforts of our designs and satellite plants` superior cost-control capability, NKL`s costs are lower than even rivals in mainland China, but our quality level is much better."

"In the past 10 years NKL has smoothly transformed into a leading gear design and application developer," Liu says. "Now we are looking ahead to the next five to 10 years. All of our R&D projects during that period have been mapped out."

Bright Future

NKL is very optimistic about its development prospects over next few years, when the global ATV/UTV market is expected to expand sharply and makers in Taiwan expect to increase their market shares. "The design, quality, and functionality levels of NKL`s products have paralleled or even surpassed similar counterparts in industrially advanced nations," Liu says. "Over the past few years our products have earned the highest confirmation from customers on quality and functionality."





Liu anticipates that Taiwan companies will continue to grab an even-larger share of the global big-bore ATV/UTV market. Most mainland Chinese rivals, he says, will have a hard time catching up in this segment over the short term, due mainly to a lack of high-performance powertrains and sufficient quality levels to meet the strict riding and driving challenges.

"NKL is committed to serving as a driving force in the development of the local and global ATV/UTV industry," Liu claims. "We will continuously integrate the abundant resources in Taiwan`s electronic, information technology (IT) and precision machinery industries with our differential products and set up a rapid-response technology platform to tap this market. Some targeted products include fully-electronic differentials that can adapt to various road and driving conditions intelligently."

Looking ahead, NKL plans to introduce the Advanced Product Quality Planning (APQP) system to guide product and service quality improvement.

"Any customer that cooperates with NKL will improve their advantages in product-development period, cost, and product quality and functionality," Liu confidently claims. "NKL has unmatched capability in this area. We don`t just sell finished products but also provide integrated solutions to help traditional industries upgrade production."

For example, NKL plans to soon debut high-level solutions for upgrading overall power-output performance golf cars and other lightweight vehicles.
(by Quincy Liang)