THTMA Chairman Puts Priority on Promoting Digital Tools in 2006

Charlie Hsieh' chairman of the Taiwan Hand Tool Manufacturers' Association (THTMA)' says he will devote more resources in 2006 to raising the global profile of a unique digital-tool technology developed in Taiwan' hoping thereby to steer his industry on a high-tech development path.

In the new year' Hsieh says' the association will arrange a training program at China Steel Corp. (CSC) for association members to learn from CSC materials specialists how to use light but durable metals in their tools' especially digital tools. The training program will focus on training in special surface treatment and hardness treatment for magnesium alloy' which is known for its lightness and durability.

"Weight is a major issue for digital tools'" Hsieh says. "And then durability becomes another factor when lightness is required."

Fine Tuning

Digital-tool technology was recently debuted by the Mechanical Industry Research Laboratories (MIRL) of the government-backed Industry Technology Research Institute (ITRI). The technology is made up of a two-centimeter wide liquid crystal display (LCD) meter and a sensor IC. "It is not like the ordinary digital systems you see in other machines'" says Li Ming-hua' a product manager in MIRL's Precision Machine & Control Technology Division. "The system is able to precisely measure torque force' tension force' temperature and even the calories a tool user burns on a job." Li's laboratory developed the technology in cooperation with several THTMA members.

The innovative digital-tool system is reportedly the smallest of its kind in the world. Incorporating the technology in hand tool production is expected to add 10% to 20%' or NT$16 to NT$20' to the cost of making such tools' according to Li. "This is a minor cost increase and we hope that it will boost Taiwan's share of the US$10.6 billion global hand-tool market from the present 20% to 40% or so'" he says. Taiwan shipped US$2.35 billion worth of hand tools in 2004 and is estimated to add US$100 million to the shipment in 2005.

THTMA's Hsieh is trying to organize a joint venture to license the technology from MIRL. Around 20 association members have expressed an interest in joining the venture. Once the venture is established' they will begin producing various tools equipped with the digital system.

In addition to its partnership with CSC' THTMA will team up with an incubator center of the National Chung Hsin University and the Taiwan Magnesium Association (TMA). The association will also work with the National Yunlin University of Science and Technology to develop ergonomic designs for the digital tools.

After the production and design elements are in place' marketing will be the major focus of the drive into the digital tool market. Hsieh has been asking the government for subsidies to help his association promote Taiwan-made digital tools at international trade shows. In each of the past few years' association members have exhibited their latest products at 10 major international trade shows including Intertool in Moscow' Auto Accessories & Parts in St. Petersburg' Expo Nacionel Ferretera in Mexico' Hardware & Garden Tools in Melbourne and Hardware & Tool Show in Bilbao. "Soon' our digital tools will be seen at these major shows'" Hsieh says.

Hsieh is confident of turning the global spotlight on Taiwan-made digital tools' drawing on his extensive marketing background. A former official at the government-backed Metal Industries Research and Development Center' Hsieh opened his own business' Jun Kaung Industries Co.' Ltd.' in 1985. He began tapping overseas market in the following year by exhibiting his company's products at major global trade show. He had served as the leader of the association's marketing committee for 10 years before he was elected chairman in 2004.

Escaping the Price Squeeze

In the face of low-price competition from mainland Chinese suppliers and global oversupply of hand tools' Taiwanese suppliers need to accelerate their shift up-market into high value-added products' Hsieh says. He notes that more and more Taiwanese tool suppliers have shifted their emphasis to products for professional users and maintenance workshops and away from products for household consumers. "Professional tools command a much higher value than consumer tools. And digital systems can add even more value to such tools'" he says.

Hsieh admits' however' that promoting digital tools will be a long and difficult task. "Adequate training is necessary to the success of promotion work'" he stresses. He estimates that the digital technology will keep profits high in Taiwan's hand-tool industry for at least five years.

In Hsieh's view' all the programs for digital tools are simply steps toward the higher purpose of boosting Taiwan's hand-tool industry. "By developing digital-tool technology we have integrated industrial' academic and research resources for future development of Taiwan's tool industry'" he says. (Nov. 2005)