Taiwan Electronics Industry Targets Rapid Growth

The production value of Taiwan’s automotive electronics industry could top 1 trillion New Taiwan dollars ($31 billion) by 2020, according to the Taiwan Electrical and Electronic Manufacturers’ Assn (TEEMA).

This would be more than a sixfold jump over last year’s output of NT$156 billion ($4.8 billion), calculated by the country’s Industrial Economics and Knowledge Center. But TEEMA believes that total was undervalued because it didn’t take into account production by non-traditional suppliers such as information and communications companies that are expanding into automotive electronics. Including these companies likely would have boosted 2015 levels to more than NT$200 billion ($6.2 billion), the 3,300-member trade group estimates.

The bulk of Taiwan’s automotive electronics production is exported for use in aftermarket applications. Future growth is expected to come from a combination of expanding into new markets—including the U.S., mainland China and the Middle East—winning OEM contracts and the continued increase of in-vehicle electronics content, including advanced driver-assist systems (ADAS), connected vehicle devices and other emerging technologies.  

“We are encouraging our members to become more innovative,” says Fu-Hsiong Cheng, TEEMA’s vice chairman. “They are starting to invest more on research and development for next-generation cars.”

More than 1,100 exhibitors participated in the combined Taipei International Auto Parts and Accessories (AMPA) and AutoTronics shows this year. In addition to local suppliers, the event drew companies from China, Hong Kong, Indonesia, Malaysia and Thailand as well as large global companies such as chipmakers Infineon, Renesas and Texas Instruments.

Mobiletron Electronics showcased its Internet of Vehicles technology in an electric minibus at the show. The vehicle featured 360˚ cameras, wi-fi, large display screens, real-time navigation, various telematics functions and ADAS features. The Taiwanese company, which was founded in 1982, envisions such vehicles being used as mobile offices and classrooms as well as for emergency responders. Mobiletron also is developing an intelligent tire pressure monitoring system that measures tire wear.

Several companies are looking to grow through sales of light-emitting-diode headlights and taillamps. Depo Auto Parts, for example, recently opened a 1.1 million-sq-ft LED factory in Taiwan. The company expects LEDs to be fitted in more than 50% of new cars worldwide within five years compared with less than 5% today, vice president Michael Hu says.

The company opened a tech center with an electrical engineering department five years ago and invests about 10% of its annual sales into r&d. “We want to compete on quality and service, not just price,” Hu says. But he concedes that it is an ongoing challenge to overcome the low-quality perception that comes with being an aftermarket supplier.

Eagle Eyes, another Taiwanese lighting supplier, is increasing its LED business even faster. Since launching production in 2012, LEDs have grown to 50% of the company’s business and such output is projected to reach 100% within two years, according to Shawn Li, the company’s senior sales manager. He says Eagle Eyes also is developing next-generation organic-LED systems, which the company hopes to show in prototype form next year.

Becoming a leader in OLED technology could help Taiwanese firms transition from aftermarket suppliers to win contracts for production programs in China and southeast Asia, adds Luo Huai-Jia, TEEMA vice president. He notes that Taiwanese companies also are developing OLED systems for interior displays and smartphone applications.

E-Lead Electronics introduced an aftermarket head-up display system in China and Taiwan last year and is expanding to other markets this year. The device, which plugs into a car’s OBD-II port, costs less than $300, according to the supplier. The 23-year-old company also makes several other electronic systems, including products for navigation, displays, rear-seat entertainment, tire-pressure monitoring and ADAS. About one-third of E-Lead’s 600 employees in Taiwan are engineers, according to sales account manager Steve Yang. “We want to increase awareness and create a global brand,” he says.

Another area Taiwan suppliers are targeting is products for electric vehicles. “Our companies are famous for motors and motor control, and energy savings know-how,” Luo says. Mobiletron, for example, supplies an battery management system to Chinese EV-maker BYD.   

A growing number of companies also are joining the Taiwan Autotronics Collaboration Alliance, which was formed in 2012 to help domestic firms share resources and reduce costs through partnerships. Photic Electronics has used the service several times, including a recent partnership to develop and market a camera-based rearview display.