Taiwan Moves Up in CNC Machine Tool Market

Spurred by the increased demand for automated production equipment around the world, Taiwan's machine-tool manufacturers are accelerating development of a variety of CNC (computerized numerically controlled) models with outstanding results.

While most of the manufacturers are concentrating on general-purpose machines, some well-established firms with research and development team are scrambling to develop unique designs to attract buyers from the upmarket.

An industry insider estimates that CNC models command over 75% of the domestically made machine tools in terms of production value. Some firms in this line claim they can roll out the CNC machine tools on par with those made in such highly industrialized nations as Germany, Japan, Italy and the United States in terms of product quality and machinery performance. Yet the CNC machine tools supplied by Taiwan are generally 20% to 30% lower than those made in highly industrialized nations, which has spurred up the interest of buyers from any corner of the world.

Taiwan exported US$3.471 billion worth of machine tools in 2007, representing a 17.1% year-on-year gain, according to customs statistics compiled by the Taiwan Machine Tool Foundation (TMTF). Of this amount, exports of metal-cutting machine tools came to US$2.73 billion, up 18.8% annually and exports of metal-forming machine tools amounted to US$740.61 million, up 11.2%.

C.C. Wang, TMTF chief executive officer, believes domestic manufacturers of CNC machine tools can enjoy double-digit sales growth in the years to come if they continue to develop sophisticated and high-value-added products.

Competing on Performance

The Taiwan Association of Machinery Industry (TAMI), one of Taiwan's largest industrial associations, has called for domestic manufacturers of CNC machine tools to boost their international competitiveness by enhancing the functions of peripheral equipment.

The TAMI warns that domestically made CNC machine tools are priced too low because they have fewer functions than those made by rival manufacturers in Japan, Germany and South Korea. To tap the fast-growing automotive industry in mainland China, domestic manufacturers in this line should boost the value of their products to compete with rivals, the association counseled.

Over the past several years, domestic CNC machinery makers, including Dah Lih Machinery Industry Co., Quaser Machine Tools Inc., Tongtai Machine & Tool Co., Victor Taichung Machinery Works Co., Yeong Chin Machinery Industries Co., Roundtop Machinery Industries Co., Leadwell CNC Machine Mfg. Co., and Goodway Machine Corp., have been working hard to develop sophisticated CNC machine tools for the automotive industry.

Although these manufacturers have made big strides in developing high value-added CNC machine tools, their products still lag behind those made by Japan, Germany and South Korea, especially in terms of the average unit price.

High-performance, High-efficiency

With its highly seasoned R&D department and 20 years of manufacturing experience, Campro Precision Machinery Co supplies high-value-added CNC machine tools, including CNC lathes and high-performance machining centers.

The company has production facilities in Taiwan and Shanghai of mainland China. The company says it has not only committed to producing the most advanced CNC machine tools, but also offering fast after-sales services.

In addition to its production facilities, the company has an after-sale service center in Beijing, China to promptly serve customers in that lucrative market.

At present, the company's major product lines are CNC vertical machining centers, CNC lathes (high-precision linear guideway/boxway CNC lathes), high-speed mold-making machining centers with 15,000 rpm in spindle speed, three-axis square guideways vertical machining centers, high-performance vertical machining centers, and vertical machining centers with advanced control systems.

The company adopts modular design on its CPL-series CNC lathes, allowing the matching of different types of peripheral equipment to meet different machining needs. The unit has a 10-tool hydraulic turret that can complete tool-to-tool changes in only 0.3 seconds, boosting efficiency. The company says all of its products are developed to meet customers' special requirements for specific machining job.

Slant-bed CNC Lathes

Rather than focusing on general-purpose CNC lathes like the industry's forerunners, Jashico Machine Manufacture Co. has made its name as a provider of large-sized lathes under its "Top-Turn" brand. The company says such machines are the result of long-term dedication to developing sophisticated technologies.

Founded as a producer of high-speed lathes 25 years ago, Jashico shifted focus to the development of large-sized lathes in 1992 and began rolling out the high-value-added products in the following year. At present, the company's mainstay product lines are CNC lathes with spindle bores of nine inches to 21 inches in diameter.

"World demand for large-sized CNC lathes will grow rapidly in the coming decade due to the growth in the oil-exploration, wind energy, nuclear energy, papermaking and steel refinery sectors. Our business has been strong over the past three years," says George Wang, president of Jashico.

Jashico claims it has developed Taiwan's largest slant-bed CNC lathe with large swing-over-bed, large-bore capable of processing workpieces of two to12 meters in length. The CNC lathe can be equipped with C-axis to perform such functions as cutting, milling, drilling and engraving. It can simultaneously work as a planomiller and vertical lathe to achieve lower loading and unloading times compared to two-cycle processing machines.

The company's most popular large-sized slant-bed CNC lathe is equipped on models with 14.5-inch bores for such functions as processing oil pipes. In the past, the company could deliver the 14.5-inch model in 90 days after order confirmation. Today, though, buyers have to wait 400 days due to a backlog of orders.

The company says it is one of only two manufacturers in Taiwan able to make such large CNC lathes, and the other producer has only 20% of the production capacity that Jashico has. The company's large-sized CNC lathes sell for as much as US$580,000.

Wang says his company began focusing on the production of large-sized slant-bed CNC lathes five years ago. As early as in 2004, the company realized it needed to develop high-precision multi-task lathes able to perform such machining tasks as milling, cutting and drilling to add value to its products.

The company employs high-tier GB300 cast iron as machine bed to make its lathes. "The GB300 has more alloy ingredients than general-purpose cast iron," explains Wang.

Wang says his company has made an enviable return on investment by focusing on the production of large-sized CNC lathes over the past several years. "When we decided to produce large-sized CNC lathes, we set aside a lot of money for research," says Wang. "Over the past five years we have invested NT$60 million (US$1.81 million at US$1:NT$33.1) in R&D. We have mature technology for producing large-sized CNC lathes, so we can make a return on our R&D investments in one year."

So far the company has developed 80 versions of software for its multi-stack lathes, with each system costing NT$2 million (US$60,600). The company says it will step up development of grinders for use on the multi-stack CNC lathes.

Jashico says it could make huge profits this year. "We have been accumulating manufacturing skill and know-how to produce large-sized CNC lathes since our inception," says Wang. "Thanks to our well-established design and manufacturing skill, we will begin making high profits this year as we have secured several orders for our most profitable products."

High-speed Machining Centers

Arix CNC Machines Co., Ltd., founded in 1995 in Tainan County, southern Taiwan, is a manufacturer of CNC (computerized numerically controlled) high-speed machining centers and other CNC machine tools.

With its experienced R&D department, the company says it can provide price-competitive CNC machine tools of high performance. Arix Yang, general manager of the company, says Arix's R&D technicians have expertise in the fields of mechanical design, computer hardware and software, machining techniques, and international marketing.

The company exports its products under the 'Arix' brand. With a workforce of 25, the company can roll out 20 CNC machining centers per month.

Yang says his company is developing advanced technology to manufacture high-speed machining centers. "We can offer compact machining center for high-speed machining jobs," says Yang. "Our most compact model occupies only three square meters. But the machine has a high-speed spindle with over 20,000rpm in spindle speed, fast enough to cut HRC60-class hardened steel."

At present the unit export price of the company's products ranges from US$25,000 toUS$50,000 each. Over the past three years, the company's revenue has grown at an annual clip of 30%.

With the support of its R&D team, the company has been steadily developing innovative machine tools to meet the changing demand in the world marketplace. The company is also speeding up development of a double-column high-speed machining center.

Original Design Ability

Positioning itself as Taiwan's leading innovator in the field of specialized machine tools, Shenq Fang Yuan Technology Co., Ltd. is one of the few suppliers of differentiated five-axis CNC machining centers in Taiwan. The company can develop state-of-the-art CNC machine tools to meet customer demand, helping it secure many orders by word of mouth over the past several years. As a result, the company's "S.F.Y." brand is highly regarded in the international market.

The company says its long-term focus on top-tier machine tools has paid off. Over the past few years the company has secured many orders for customized machines, affirming the company's ability to design reliable machines.

Since its establishment in September 1996 in Taichung City, central Taiwan, Shenq Fang Yuan has made significant strides in developing special-purpose machines, including CNC five-axis machining centers, CNC high-speed panel cutting machines, CNC double-column high-speed machining centers, CNC four-axis rotary tire mold engraving and milling machining center, CNC four-axis high-speed roller engraving and milling machining center, and CNC double-column high-speed engraving and milling machining center.

The company claims it has rapidly accumulated sophisticated manufacturing technologies by focusing on production of custom-designed machine tools. Every item made by the company has unique functions. For instance, its HA-5AX7 five-axis machining center, which was developed three years ago, can do sphere machining jobs on alloy steel. "The machine was totally developed on our own," says Jimmy Huang, managing director of the company. "We are the only company in Taiwan capable of designing such a sophisticated machining center. We have shipped the machines to customers in Taiwan, Germany, Ukraine and other Asian nations."

With its well-established expertise, Shenq Fang Yuan can develop specialized machine tools from scratch. "In general, we don't start development until we have a design request from a customer," says Huang. "In this way, we concentrate almost exclusively on products meeting customers' specifications. Our years of experience in developing sophisticated machine tools have won us the confidence of our buyers. As a result, many of our new orders are referred by old customers."

The company claims its products can improve production efficiency. For instance, its five-axis machining center shipped three years ago has helped a fastener producer in Taiwan to slash production time by one-third by handling post-manufacturing processes such as polishing, grinding and electric discharging in a single production cycle. The company installs German and Swiss-made precision spindles that can turn at 36,000 to 42,000 revolutions per minute on such machines to ensure high machining performance.

Five years ago, the company debuted a four-axis high-speed roller engraving and milling machine, the first of its kind in Taiwan, for a domestic customer. With its high rigidity and well-designed structure, the machine can handle high-speed and high-precision heavy cutting. With high-precision transmitting elements and full parameter setting for clearance approaches to zero, the machine has a positioning accuracy within ±0.005mm. The machine can be simultaneously used for 3D four-axis roller machining and 3D three-axis machining.

The company exports around 80% of its total output. Major export outlets are Hong Kong and mainland China, South Korea, Canada, the US, Mexico, Brazil, the Philippines, Vietnam, Thailand, Malaysia, Singapore, Indonesia, India, Turkey, Greece, the Netherlands, France, Germany, Poland, Belgium, Ukraine, and Russia.

Despite the introduction of so many unique machines, Shenq Fang Yuan is still working hard to develop sophisticated manufacturing technology to produce high-end products. The company claims it can design and produce B- and C-axis spindles to produce five-axis machining centers with the strong support of its in-house R&D team.

"Although we have succeeded in developing a spate of innovative machine tools, we are still in the technology-building phase and are not in a hurry to expand production capacity yet," says Huang. "We have always focused on branded products, which puts a premium on having sophisticated technology. Firms that work only on an OEM or ODM (original equipment/design manufacturer) basis, on the other hand, need to expand output to survive the market."

Huang believes that domestic machine-tool manufacturers need to develop specialized products to fend off low-priced machines made in developing nations. "In recent years, international buyers have been increasing procurement of general-purpose machines from China," says Huang. "For instance, the number of foreign buyers to the Beijing Machine Tool Exhibition has significantly increased over the past eight years, which means mainland China is attracting attention from overseas buyers. So we have to develop unique machines to secure upmarket orders."

The company says its successful accumulation of sophisticated technologies owes to a low-level of personnel turnover. "As company founder, I deeply believe that talented workers are our most valuable assets in achieving sustainable development," Huang says. "Since our founding, our turnover has been as low as 5%. This has been a stabilizing element in the sound development of our company."