Awea Ties Up With Toyoda to Tap U.S. Market

Taipei, Feb. 15, 2006 (CENS)--Awea Mechantronic Corp., one of Taiwan' s largest manufacturers of large-sized machining centers, has stricken a technical-cooperation deal with Japan-based Toyoda Machinery, a member of the Toyota Group.

With the deal, both sides will collaboratively market Awea-produced small-sized vertical machining centers in the United States. The cooperation project is expected to help Awea create an additional revenue of NT$200 million (US$6.25 million at US$1:NT$32) per year.

Awea president Edward Yang said the small-sized vertical machining centers have been sold to the German market at the selling price of NT$2 million (US$62, 500) per unit. Awea targets to sell 100 sets of the small-sized vertical machining centers in the U.S. this year.

Toyoda will help Awea expand sales in the U.S. market with the assistance of the U.S.-based JTEKT Co., a joint venture between Toyoda and KOYO Co.

In addition, Toyoda will also commission Awea to produce another product line-the high-speed, high-precision horizontal machining centers through technological transfer. The new product will be rolled out by the end of August and will be debuted at the 2006 International Manufacturing Technology Show to be held in Chicago of the U.S. in September.

Priced at over NT$5 million (US$156, 250) per unit, the high-speed, high-precision horizontal machining center mainly appeals to customers of automobile and aerospace industries. The machines will use 'Toyoda-Awea' brand to penetrate the European, American and Asian regions.

Awea said it registered NT$417 million (US$13.03 million) in pretax earnings, or NT$7.2 (US$0.22) in earnings per share, last year. The company noted it received NT$340 million (US$10.62 million) worth of orders in January alone, hitting an all-time high record. At present, it has NT$1.2 billion (US$37.5 million) orders in hand. Despite its outstanding performance in taking orders, the company posted NT$210 million (US$6.56 million) in sales in January, down 6.69% year-on-year.

Focusing on medium- and large-sized double-column machining centers and C-type machining centers, over the past few years Awea has been aggressively developing such value-added products as column-moving crane-type machining centers and horizontal boring machines.

The company said it shipped 226 sets of double-column and 529 sets of C-type machining centers last year, up 28% and 13%, respectively from the previous year. The company is now speeding up increasing output by operating a new plant in the Central Taiwan Science-based Industrial Park. The new plant in central Taiwan is expected to begin running sometime in the fourth quarter of this year.