TECO endeavors to enhance the R&D capabilities, and seeks strategic alliances & cooperation and mergers & acquisitions in the field of “powertrain” and “energy”, including the deployment of vehicle powertrain system, solar power station, onshore substations for offshore wind farms, energy storage systems, and digital and smart automation systems, with the ultimate goal of increasing its revenues and profitability.
Manufacturing center deployment
To cope with the global regional market growth and production capacity distribution needs, the Company has integrated the existing low-voltage motor production line and supply chain management resources in order to construct four main production centers (China, Taiwan, Vietnam, India). Meanwhile, the smart production environment has been introduced.
Development of the culture of sustainability
In 2021, TECO has completed the missions of the first stage of “emission reduction by 20% within 10 years” early, including the carbon footprint inspection of representative products, installation of solar power facilities on the rooftops of the Chungli Plant, and acquisition of the issuance permission of self-use renewable energy certificates. In 2021, the Company has announced the goal of “emission reduction by 50% within 10 years” by the end of 2030 with the overseas plants also covered in the scope of implementation, thereby moving towards carbon neutrality. The “Sustainability KPI” has been fully implemented to thoroughly integrate the concept of sustainable operations into the daily tasks of every department and employee.
in thousand NT$
Regarding the global economy, the impacts of Omicron virus and inflation seem to remain. The Directorate-General of Budget, Accounting, and Statistics projects a national economic growth rate of 4.42%, with the growth momentum likely to continue being better than that of most economies. The main operation strategies and growth plans are described below:
For the electromechanical system and automation business, the demand of North America market has grown strong this year because of the rising oil price. The great pressure of “carbon neutrality” has also stimulated the electrification of shale oil production and transportation equipment and waste heat recovery in the US, which is going to promote the growth of inverter and energy conservation solutions. Moreover, the Company provides carbon neutral solutions such as high-efficiency motor drive system, power generation from waste heat recovery and inspection-free equipment for the industries with processes of high power consumption, including electronics, petrochemical, steel, paper, etc., to expand the direct sales. For the smart energy business group, a significant growth of IDC engineering business in both the domestic and foreign markets is expected due to the popularization of 5G/big data/cloud services and the outstanding technology of TECO. The orders of relevant projects in 2021 totaled more than NT$ 3 billion; the target revenue in 2022 has increased by 30%. As for the renewable energy creation and storage business, thanks to the renewable energy policy in Taiwan, it is expected that the renewable energy will make up 20% of the power generation in 2025, which implies TECO’s promising growth. For the air conditioner and smart life business group, the provision of full-area smart air conditioner and energy management continues to be the focus to contribute to a new life of ESG carbon neutrality. In addition, we also create business opportunities through innovations. Examples include launching smart refrigerator for delivery services by combining the Group’s resources and IoT technology to meet the last bit of demand for refrigeration, and accelerating the promotion of energy-saving air conditioning solution in the new business mode of renting instead of buying.
Apart from the existing businesses, the Company’s strategic development will continue to be focused on electric vehicle power system, business opportunities of renewable energy, and enhancement of digital/smart production to escalate the management capabilities. In terms of the EV power system, we will keep expanding the OEM business opportunities, with a target growth of more than 60%. With the policy of 10-year subsidy of NT$ 90 billion for the domestic production of e-bus, TECO endeavors to compete for a market share of domestic e-bus power system of more than 80%. Also, the EV motor production lines in India have been established, which can promote the orders and production due to the proximity. In response to the grid stability issue caused by renewable energy, it is expected that the global energy storage market will grow to around 70GWh in 2025 with a CAGR of 45%, and that from 2025, there will be an annual energy storage demand of 1GW in Taiwan. The Company has aggressively fought for Taipower’s energy storage demonstration project so as to make the best deployment for the upcoming business opportunities of solar power and energy storage integration. As for the digital transformation, TECO has entered the “digital optimization” stage. The BI system, behavior and performance management platform, AI-based process/product inspection system, AI order prediction system, smart supply chain management platform, etc. will be implemented consecutively, and the smart production lines will be expanded as well, strengthening the global supply chain of TECO!