Tatung launches production of refrigeration compressors in China

Taipei, Aug. 23, 2005 (CENS)--Tatung Co., one of Taiwan's leading manufacturers of home appliances, has recently begun mass production of refrigeration compressors in Zhongshan of Guangdong Province, mainland China, according to a top company executive.

Tatung president W.S. Lin said the refrigeration compressor made by his firm is the first of its kind ever produced by domestic manufacturers in this line.

According to Lin, Japanese producers have phased out production of refrigeration compressors and Tatung has secured orders for the products from the home-appliance makers of the mainland and Taiwan.

Tatung noted it would be able to roll out two million refrigeration compressors next year and the amount will double to four million units in 2006.

Lin noted his company has centered on global deployment. For instance, Tatung has invested US$20 million to set up a production base in Ho Chi Minh City of Vietnam to facilitate production of refrigerators, washing machines, air conditioners, electric cookers, and electric fans. The plant will add television sets to its product lines in the near future.

Tatung targets to score NT$10 billion (US$312.5 million at US$1:NT$32) in annual sales from production in Vietnam five years from now on. The plant will also serve as a bastion to develop the entire market of the 10-member Association of Southeast Asian Nations (ASEAN). Lin said the products made in Vietnam are free from 20% customs duties if they are shipped to the member nations of the ASEAN.

Currently Tatung's Zhongshan plant focuses on the production of reciprocate refrigeration compressors. In the foreseeable future, the plant will develop higher-tier, environmentally friendly refrigeration compressors.

Lin noted home-appliance manufacturers should also have a tight grip on key components and that the production of key components has to reach a scale of economy. That's why Tatung currently has to procure air-conditioner compressors from Rechi Precision Industry Co., a subsidiary of Sampo Corp., another leading manufacturer of home appliances in Taiwan.