Taiwan to Roll Out High-Speed Spindles for High-End Machine Tools

Taipei, Nov. 21, 2005 (CENS)--With the technical transfer from the Mechanical Industry Research Laboratories (MIRL) under the government-backed Industrial Technology Research Institute, Neo Precision Technology Co. was recently founded in Taichung, central Taiwan, to manufacture high-speed spindles.

MIRL director general Wu Tung-chuan noted high-speed spindle is the most important component for machine tools.

As an ITRI spin-off, Neo is co-founded by the former officials of MIRL, including the laboratories' former deputy director general Cheng Chen who takes the seat of presidency in Neo.

Neo is expected to begin mass production of multi-direction, five-axis, and vertical/horizontal high-speed spindles for high-end machine tools. In the early stage of its establishment, NEO will has an annual output of 100 spindles with production value of NT$100 million (US$2.97 million at US$1:NT$33.6), accounting for 25% of the domestic market demand. The rollout of the high-speed spindles will facilitate fast growth of domestic high-end machine-tool market and help domestic producers penetrate the global marketplace.

Taiwan government has set a goal to help domestic machine-tool industry double annual production value to reach NT$200 billion (US$5.95 billion) in 2008. To meet the goal, a research and development union has been formed to focus on the development of such high-end machine tools as five-axis machine tools and combination lathes which will have milling function.

Chen said his company would not compete with domestic manufacturers and position itself as a manufacturer of high-end spindles by focusing on the elevation of product quality, machining accuracy, lifetime and after-sale services.

Concentrating on the development and production of high-end products, NEO will directly challenge the world's top-four producers of high-speed spindles, including Fisher, GMN, Wiess, and IBAG.

Chen said his company would see annual sales reach NT$400 million (US$11.9 million) in three years, becoming the largest supplier of high-speed spindles in the entire Asian region. Within the next decade, the company will grow as one of the world's top-10 suppliers of the products.

Currently Taiwan demands 25,000 belt-type spindles, 900 straight-type, and 500 built-in spindles, per year. But NEO won't roll out the lower-end belt-type spindles as the price tag for the products is less than NT$20,000 (US$595).

NEO has set up two production facilities in Taichung Industrial Park, which are designed to have total annual production capacity of 1,600 straight-type and 800 built-in high-speed spindles.

Domestic large-sized machine-tool manufacturers, including Victor Taichung Machinery Works Co., Awea Mechantronic Corp., Gentiger Machinery Industrial Co., Kao Fong Machinery Co., and Eumach Co., have shown high regards for the establishment of NEO. They believe adopting NEO's spindles will help them cut procurement costs by 30%, relieving their over-reliance on the imported high-price spindles made by Switzerland and Germany.