Taiwan's major precision parts maker Eurocharm Holdings is forecasting a record-breaking 2026, driven by robust North American SUV-related demand, a structural shift toward electric scooters in Vietnam, and early traction in a new server rack business expected to become a key growth driver from 2027. The company expects full-year revenue to approach NT$9 billion (approx. US$281.9 million) as its diversified order base strengthens across automotive, powersports, and electronics segments.
Eurocharm said monthly revenue has stabilized in the NT$700-800 million range, supported by sustained orders from major clients including American Honda Motor, Harley-Davidson, and Vietnam's VinFast.
The company expects shipments tied to new model launches to accelerate through the second half of 2026, with the fourth quarter likely to mark the annual peak. Management anticipates a clear second-half weighting as production ramps across multiple platforms.
North American SUV cycle repositions supply chains
Although the North American SUV market has faced near-term pressure from inflation, Eurocharm said it has benefited from ongoing supply-chain restructuring among OEM customers.
American Honda Motor is undergoing a major product overhaul cycle, typically seen once every decade. Eurocharm began shipments in April 2026 for powersports-related side-by-side (SxS) off-road models produced at the customer's South Carolina facility, with all-terrain vehicle (ATV) components expected to follow, expanding its penetration into the OEM supply chain.
At the same time, inventory correction at Polaris concluded at the end of 2025, with restocking normalizing from the first quarter of 2026. Eurocharm expects this replenishment cycle to continue throughout the year, providing additional support to shipment volumes of powersports vehicles.
Harley-Davidson upgrade cycle lifts product mix
Eurocharm said its relationship with Harley-Davidson is shifting toward higher-value components as product specifications evolve.
The company is moving beyond traditional stamped and welded parts into higher-margin aluminum die-casting and forged components, reflecting deeper integration into new platform development programs. Multiple refresh projects are also underway, reinforcing medium-term order visibility.
To strengthen North American responsiveness, Eurocharm has acquired a facility in South Carolina and is building an automated warehousing system to shorten delivery lead times.
While installation-related logistics costs will keep expenses elevated through 2026, the company expects efficiency gains and a meaningful reduction in the expense ratio once the system is fully operational by year-end.
Vietnam's shift to electric scooters reshapes demand
In Southeast Asia, Eurocharm is benefiting from a structural transformation in Vietnam's motorcycle market. Environmental regulations in major cities such as Hanoi and Ho Chi Minh City have pressured demand for gasoline-powered motorcycles, contributing to an 11.4% year-on-year decline in Vietnam Honda's first-quarter 2026 sales.
By contrast, electric mobility demand is accelerating rapidly. VinFast's electric scooter sales more than doubled year-over-year in the same period, driving strong supply-chain demand. The company has increasingly shifted production orders to Eurocharm amid capacity constraints elsewhere.
VinFast now contributes more than 4% of Eurocharm's revenue, with order volumes exceeding initial expectations. The company noted that electric scooter components generally carry higher technical barriers and improved gross margins compared with conventional internal combustion models.
Server rack business emerges as next growth engine
Beyond traditional automotive components, Eurocharm is advancing into electronics manufacturing, targeting server racks as its entry product due to relatively stable specifications and scalable production potential.
Small-volume production began in the second quarter of 2026, with mass production possible by year-end pending certification progress. The segment is expected to contribute a low-single-digit share of revenue this year.
More significantly, Eurocharm's internally developed server rack platform is currently in certification and is expected to become a major profit driver in 2027, marking a strategic diversification beyond automotive supply chains.
Multi-segment expansion driving growth momentum
Eurocharm expects a strong growth trajectory over the next two years, supported by synchronized expansion across North American SUV programs, Vietnam's electrification shift, and emerging electronics manufacturing opportunities. The company's diversified exposure across automotive, powersports, and data infrastructure positions it for accelerated scale as new product cycles mature
Article translated by Willis Ke and edited by Jack Wu
