Chun Yu Diversifies Markets and Products for Sustained Growth

In response to the harsh climate for traditional industries in Taiwan, Chun Yu Works & Co., the island's leading producer of nuts and bolts, is seeking sustained development by expanding into the Chinese market and diversifying into high-end products for industrial use.

The company is working hard to set up a comprehensive sales network in the huge Chinese market, building on the experience it has gained there since it built factories in Dongguan, Guangdong Province, 10 years ago.

Chun Yu has now organized a trading subsidiary to oversee its sales offices in China. These now number more than 10; they will be increased to 14 by the end of 2009, and to 50 in three to five years. Together with the Dongguan factories and the corporate headquarters in Taiwan, they will help form a streamlined global logistics operation.

Thanks to years of heavy investment in R&D work and US$1.5 million worth of advanced manufacturing equipment, the company has achieved major technological breakthroughs in the production of high-end products for industrial use. It has passed certification by the world's largest maker of auto suspension systems and is filling its orders, thereby becoming Taiwan's first maker of nuts and bolts for automotive use.

This offers a lucrative opportunity, since automotive nuts and bolts sell for three times as much as utility products and can be supplied not only to automakers as original equipment (OE) but also to the huge aftermarket in China. Chun Yu has seen a recent 20% jump in sales of auto bolts in the Chinese market, largely because of mainland government's "cars for the countryside" incentive program.

Sales of home-appliance bolts are also booming in the Chinese market, where they have swelled by 30% following the introduction of the government's "home appliances for the countryside" program there. Most of the bolts go into leading Chinese-brand refrigerators and air-conditioner compressors.

The company is capable of turning out aviation-grade bolts, and passed France's AS9100 aerospace-system certification back in 2006. It can also make hardware for medical use-in false teeth, for example-and for railway equipment.