Unveiling Delta and Compal's Global Strategies: A Closer Look at Their Expansion Plans
Delta Electronics Inc: A Global Electronic Powerhouse Advancing in North America
Delta's earnings increase by 21.6%; Compal's sales decline by 19.4%
By Scott Johnson
In a recent stride, power supply and electronic component maker Delta Electronics Inc (台達電) reported a significant surge in revenue, reaching NT$40.78 billion (US$1.35 billion) last month. This whopping 21.6% year-on-year increase was driven by the booming demand for power and heat dissipation products used in AI-related devices[1].
Contrasting the positive trend, a minor 6% month-on-month drop from NT$43.44 billion was observed. cumulative revenue in the first four months soared 27.9% to NT$159.7 billion, according to a statement by Delta[1].
While grappling with a slight dip, Delta remains confident about its revenue growth forecast for this quarter, reaffirming its earlier predictions[1]. During a recent earnings conference, Delta Chairman Ping Cheng (鄭平) indicated that this quarter would see revenue surpassing the first quarter's NT$118.92 billion, mainly thanks to front-loaded orders from US customers seizing the 90-day pause of "reciprocal" tariffs[1].
Enticing as the US market may seem, Delta is pondering the feasibility of establishing a factory in the United States. Surprisingly, Delta finds it more cost-effective to focus on exports from Thailand, despite the 30% tariffs on these products[2]. To diversify its manufacturing capacity, Delta is building five new factories in Thailand, complementing its existing production sites in Taiwan and India[1][2].
Compal Electronics Inc: Navigating the Complexities of International Expansion
In a separate development, notebook computer contract maker Compal Electronics Inc (仁寶) reported a 19.4% year-on-year dip in revenue last month, amounting to NT$62.29 billion[3]. The US tariff policy continues to create uncertainty, making it challenging to predict the full extent of Compal's business impact[3].
In an intriguing turn of events, Compal is considering the possibility of setting up a factory in the US - potentially in Texas - while accelerating its deployment in Mexico[3]. Although the details are yet to be finalized, Compal Chairman Ray Chen (陳瑞聰) has hinted at the prospect of a US factory[3]. Additionally, the soaring New Taiwan dollar has prompted Compal to brace for some foreign exchange losses[3].
In these trying times, Compal is witnessing a surge in front-loading and urgent orders, which has helped boost shipments[3].
Enrichment Insights:
- Delta Electronics Inc: In addition to its North American plans as mentioned above, Delta also plans to manufacture new 50kW DC Wallbox chargers in Plano, Texas, to contribute to the growth of electric vehicle (EV) infrastructure across North America[4][5].
- Compal Electronics Inc: Further details on Compal's expansion plans in Thailand, Texas, or Mexico could not be found in the search results.
- Despite the minor drop in monthly revenue, Delta remains optimistic about exceeding the first quarter's revenue due to front-loaded orders from US customers, suggesting a potential technology component in their growth strategy.
- In an effort to diversify its manufacturing capacity, Delta is planning to establish five new factories in Thailand and is considering the possibility of setting up a factory in the United States, possibly indicating Technology as a key component in their expansion plans.
- Compal Electronics Inc, facing a year-on-year revenue dip, is exploring the possibility of setting up a factory in the US, particularly in Texas, while also accelerating its deployment in Mexico. This technology-driven strategy could potentially help Compal navigate the challenges posed by US tariff policy.
