Taiwan's automotive parts suppliers are broadening their reach into high-tech sectors, capitalizing on their expertise in precision engineering and advanced manufacturing. The semiconductor industry, which demands similarly high standards of quality and reliability, has become a logical next step. Tsang Yow Industrial Co., a leading transmission system manufacturer, is now seeing early returns from its foray into semiconductor component production.
Semiconductor expansion drives revenue growth
Since 2021, Tsang Yow has steadily diversified beyond its core business, gaining certified supplier status from a major global semiconductor equipment maker in 2023. This marked its official entry into the semiconductor component supply chain. The company has since won several new project orders, with prototyping and testing set to ramp up in the second half of 2025, paving the way for future volume production and revenue acceleration.
A cornerstone of Tsang Yow's growth plan is a new plant in Malaysia, scheduled to begin mass production in the second quarter of 2026. The facility will expand manufacturing capacity and fuel the next phase of growth. The company is also enhancing profitability by shifting its product mix toward higher-margin offerings and refining processes to cut costs and boost efficiency, strengthening its competitiveness in a volatile market.
Margins climb on improved product mix
Tsang Yow posted consolidated revenue of NT$284 million (US$9.37 million) in the first quarter of 2025, marking an 18% sequential increase despite a 7% year-over-year decline. The quarterly boost was driven by deferred shipments from customer orders placed in late 2024.
Higher-margin segments—namely, aftermarket (AM) and original equipment service (OES) components—made up 56% of first-quarter sales, improving the overall product mix.
Operating profit surged 181% quarter-over-quarter to NT$55.06 million, up 2% from the same period last year. Net income attributable to the parent company totaled NT$54.85 million. Improved cost discipline and lower idle capacity losses contributed to the strong performance.
Gross and operating margins climbed six and eleven percentage points from the fourth quarter of 2024 to 34% and 19%, respectively, highlighting the impact of Tsang Yow's focus on high-value products and streamlined operations.
Tsang Yow remains cautiously optimistic for 2025, aiming to deepen its foothold in the automotive sector while expanding its role in clients' new product development pipelines across multiple industries.
Article translated by Levi Li and edited by Jerry Chen
