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Yageo to Build World`s Largest Passive-Component Production Base in Suzhou
2007/10/30
Taipei, Oct. 30, 2007 (CENS)--On the 10th anniversary of its Chinese operation, Yageo Corp., a major passive-component maker, inaugurated its second Suzhou plant in China yesterday (Oct. 29), which will transform the company`s Suzhou operation to the world`s largest passive-component production base following completion of its second-phase facility next year.
Inauguration of the second Suzhou plant is a milestone for the Chinese operation of Yageo, which has established a comprehensive production and sales network for passive components in China since entering the market in 1996.
Yageo is now the largest resistor-chip supplier in China, boasting market share of 39%, as well as one of the top three MLCC (multilayer chip capacitor) suppliers, with market share reaching 19%. Due to the rapid growth of its Chinese business, overseas sales has now accounted for 50% of the company`s total revenue, similar to its Taiwan operation, with the former expected to hit 70% in three to five years.
The company harbors a rosy outlook for its Chinese business next year, due to the fast expanding domestic demand and the effect of the Beijing Olympics, as a result of which the Chinese markets of notebook PCs, mobile phones, and LCD (liquid crystal display) TVs will jump 40%, 20%, and 67%, respectively, next year, much higher than the projected growth rates of 22%, 10%, and 33% for the global markets.
Construction on the second-phase project of the company`s second Suzhou plant will break ground soon, and following its completion in February next year, monthly capacities of Yageo`s Suzhou operation will hit 36 billion units for resistor chips and 11 billion for MLCC, making it the largest passive-component production base worldwide.
Plus its Taiwanese plants, Yageo`s global resistor-chip capacity will leap 33% to 44 billion units a month next year, when its MLCC capacity will advance 51.7% to 22 billion units, with major growth driver being high-capacity products, rivaling its Japanese counterparts in technological level.
In addition, Yageo will also set up its third R&D center worldwide in Suzhou, following Taiwan and Europe. The R&D building in Suzhou will also be completed next February, similar to the second-phase project of the second Suzhou plant, according to Ting Chung-yi, president of Yageo`s Chinese operation.
Chen Tai-min, Yageo chairman, noted that the company`s capital outlay will reach NT$3-4 billion next year, higher than this year`s NT$3 billion, with Taiwan still absorbing 80% of the outlay.
One major purpose of the capital outlay is to support the company`s fast developing antenna production. The company is now turning out 2.5 million antennas monthly, mainly for Bluetooth, the largest item, WiFi, WiMAX, WWAN, and GPS (global positioning satellite) products used in notebook PCs and mobile phones, with annual revenue reaching NT$600-800 million, only 3-4% of its total figure. The company projects its antenna revenue will jump 40% this year and double next year before hitting NT$3 billion in 2010.
(by Philip Liu)
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