Taiwan's auto parts supplier revenue on track for new highs

Domestic auto parts manufacturers reported self-settled revenue in January, of which major domestic aftermarket parts supplier Tong Yang Group (TYG) NTD$$1.744 billion is at a 25-month high; while auto lamp maker Depo Auto Parts was valued at NTD$1.434 billion, the second-highest in 10 months.

In addition, the combined revenue of the auto transmission system manufacturer Hota Industrial in January was NTD$523 million, the second-lowest in 11 months; the car light manufacturer was NTD$434 million, the second-highest in 8 months.

TYG's consolidated revenue since January was reported at NTD$1.744 billion, an increase of 3% from NTD$1.693 billion in December last year and a 17.33% increase from NTD$1.486 billion in the same period last year, making it the highest point since January 2020.

TYG pointed out that although factors such as shortage of OEM chips, high freight shipping rates in the after-sales maintenance market (AM), port congestion, and delayed shipments by customers are still present, the company remains flexible to rectify, reduce costs, and develop new products.

In addition, Depo's consolidated revenue in January was NTD$1.434 billion, an increase of 6.36% from NTD$1.349 billion yuan in December last year, and a slight increase of 1.8% from NTD$1.409 billion in the same period last year, the second-highest since April last year.

Depo is actively expanding the capacity of its factory operations in Taiwan. The Chiayi factory is expected to be completed by the end of this year. The factory mainly produces BMC injection and processing. In terms of R&D layout, the Tainan Xinying Mould Factory is expected to be completed by the end of this year.

The annual designed production capacity of plastic lamps and fog lamps of Depo Lukang plant in Changhua is about 17 million pieces, while the annual designed production capacity of headlights and fog lamps of Xinying Plant is around 13 million pieces; Zhangbin Plant is at 10 million pieces, and the total annual production capacity is 40 million pieces.

Hota's consolidated revenue in January was marked at NTD$523 million, a slight decrease of 2.4% from NTD$535 million in December last year, and a 14.3% decline from NTD$610 million in the same period last year, the second-lowest since March last year. Legal persons have said that Hota's revenue in January was still affected by factors such as lack of raw materials, lack of shipping containers, and shipping congestion in ports.

Looking ahead to Hota's operating performance this year, a foreign-funded corporation in the U.S. pointed out recently that Hota's continued to benefit from the substantial recovery of the internal combustion engine (ICE) vehicle orders, and the number of major customers' outsourcing orders continued to grow. Also, the shortage of raw materials and labor shortages are expected to gradually ease. Legal persons estimate that Hota's performance this year is expected to grow by 10% to 15%, but it is still necessary to pay attention to the potential interference of increased demand for freight shipping.

In terms of Hota's electric vehicle market strategy, foreign legal persons have pointed out that their EV customer projects outside of major US EV manufacturers have significantly increased volume, and it may take a while. It is estimated that the demand in this category will increase significantly from the second half of this year to next year.