Soco, a small manufacturer of pipe benders in Taiwan, has expanded its business with the explosion related to the auto parts in the automotive industry in countries such as Romania.

Taipei correspondence

Soco, a Taiwanese manufacturer of pipe benders for the automotive, furniture and sports industry, hopes that a second wave of outsourcing of auto parts towards Romania and the other countries of Eastern Europe will provide the company with a new resource to expand business, over the current 20 mil. $ threshold.

In countries like Romania, the biggest sales recorded so far have been related to the pipe machining equipments for the automotive industry, said Kyle Lo, the Company’s Executive Manager, during a meeting with reporters from Eastern Europe, held by the Taiwan External Trade Development Council (TAITRA).

"As far as Romania is concerned, we have agreements with companies which manufacture parts for Dacia Renault and Hyundai. Toyota has also begun to invest in Romania and this might be of help for us. Romania manufactures shock absorbers for Toyota", said Lo for ZF. The company hasn’t concluded so far any agreement with the suppliers of the American Ford Company, which manufactures cars at the plant in Craiova.

"The presence of Ford generates no business for us in Romania because parts are assembled locally, there is no production". Soco, a company founded in 1979, currently has 450 employees and three plants, in Taiwan, China and Malaysia. The machine tools manufactured by the company are used for pipe bending for companies in the automotive, furniture, medical or fitness equipment industry.

"We manufacture parts for the furniture created by Ikea, car exhaust and gas supply pipes, pipes used in wheelchairs. Any product that uses metal tubes may be created by our cutting or bending machines. Our priority is to orient ourselves towards laser cutting machines”, said the Soco official.

Las year, the company’s business with European partners was “next to nothing” because of the financial crisis that hit many of Soco’s traditional customers. "The manufacturers of auto parts and furniture were badly hit. The worst was in constructions, where a part of our customers have simply disappeared", said Kyle Lo. However, the prospects for next year are slightly better, continued the representative of the Taiwanese company.

"Eastern Europe remains a very interesting market for us because we see that a large part of the Western manufacture is outsourced to the Eastern countries."

Although he complains about the business practices of the countries in the region and the high bureaucracy in countries such as Ukraine, Lo says that the Taiwanese company considers opening a production unit in the area, in Turkey or the Czech Republic. "We haven’t taken any decision yet, but the countries taken into consideration are Turkey and the Czech Republic – where there is an available labor force and the position is favorable. On the other hand, it is very likely that we take this step in Turkey, where we have land and extremely favorable conditions for business, as there are many free zones, which helps us a lot. In fact, we also entered the Romanian market with the extension of a partner in Turkey. On the other hand, we shall probably open a service center in Poland".

Nevertheless, the main markets of the company are China, India and Brazil. China alone generates a yearly business of over 12.5 mil. $. Soco’s pipe cutting and binding machine tools can machine pipes ranging between 3 and 20 millimeters. The company argues that it is one of the few worldwide manufacturers which may offer complete solutions for companies which work with automotive or furniture businesses.

An industry of billions

The largest part of foreign investments in the car manufacturing industry has taken place in the last ten years, mainly in the Western part of the country where industrial parks are mostly filled by auto parts manufacturers.

A new automotive pole takes shape in the Southern area, Oltenia, where companies such as Pirelli (investments of up to 250 million Euro in the last 3 years, plus another 250 million Euro until 2012) or Ford have been attracted to.

Investments in the Eastern area are still small and have been mainly attracted by Iasi, where the biggest players are Delphi or Continental.

Source: www.zf.ro
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