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Taiwanese OEMs Now Outsource to Cut Costs

April 21, 2005
Filed under Uncategorized

Acting to overcome what has become a dilemma for manufacturers worldwide, Taiwan’s three leading producers of powersports vehicles have updated their parts procurement tactics to deal with rises in material prices that are undermining their profitability.
Until recently, Kwang Yang Motor Co., Ltd. (KYMCO) and Sanyang Industry Co., Ltd. (SYM) only exported parts to China and other Southeast Asian nations.
According to a report by the Taiwan Times, SYM now works through a trading company in Shanghai that serves as a parts supply center for its plants in Taiwan, China and Vietnam, and KYMCO out-sources price competitive parts from suppliers in Southeast Asia, Italy, China and eastern Europe. KYMCO also reportedly is debating deals in India.
Yamaha Motor Taiwan Co., the third most prevalent brand in Taiwan and a subsidiary of the Japanese brand, has decided to procure parts from Yamaha factories in Thailand, Indonesia, China, Vietnam and India to cut costs.
Yamaha Taiwan president Matsuo Mitsuaki told reporters that Yamaha Motor Co. in Japan has worked out a global deployment strategy to allow its global affiliates and subsidiaries to outsource parts from each other.
At the moment, Yamaha Taiwan is the production and export base of sub-150cc scooters for Yamaha Japan.

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