New Orleans Reconstruction Brings Hefty Orders for Taiwanese Firms

As New Orleans begins reconstruction in the wake of Hurricane Katrina, many Taiwanese suppliers are struggling to meet floods of related orders.

The scale of the reconstruction work is estimated at US$200 billion, creating huge business opportunities, especially for manufacturers of building materials, hand tools, furnishings, and auto parts. Many American purchasing agents have recently traveled to Taiwan to secure a supply of these materials.

For instance, Global Union Industrial Corp., Taiwan's largest faucet maker, recently received many big-ticket orders from American buyers, a rare phenomenon since September and October are a traditional off-season for its business. The buyers confirmed that the materials are meant for the reconstruction work in New Orleans. Since the city is a relatively less wealthy area, most of the orders are for lower-end products, with price tags between US$50 and US$100.

As a result, Global's September sales hit NT$400 million, a whopping 90% growth over the year earlier. The company expects to maintain a similar level of revenue for the fourth quarter and to maintain its growth in the first quarter of next year. As a result, the company's mainland Chinese plant has located more than 20 supporting suppliers, and is ready to take on orders at an even larger scale next year.

Yang Te-hwa, chairman of Goodway Machine Corp., says that the company's heavy-duty computerized cutting lathes are used mainly for mending the drilling heads of machines used to prospect for oil. The southern Taiwan company recently received an order of NT$50 million for purchasing 12 of these lathes, a relatively unknown phenomenon during this season of the year.

Officials of Ching Feng Blinds Ind. Co., Ltd. Report that the shipment volume of blinds and furnishings from its warehouse near Atlanta in the southern U.S. picked up by 5-10% recently, as hardware and construction-materials retailers in the southern U.S. have begun buying in larger amounts. They note that sales are expected to increase further when big hardware outlets in New Orleans resume their operations.

Officials of Taiwan's Yeun Chyang Industrial Co., Ltd. Note that, due to the hurricane, the company's U.S. dealers have recently asked it to boost its output of various stainless steel products including water pipes, staircase handrails, and kitchen and bathroom hardware.

Many Taiwanese suppliers of pneumatic and hydraulic tools are also experiencing bustling businesses attributed to the need to reconstruct wooden houses in New Orleans.