Compal to build plant in Poland, eyes automotive electronics clients

Taipei, July 5 (CNA) Compal Electronics, Inc., one of the leading contract electronics makers in Taiwan, has announced plans to build a factory in Poland to target automotive electronics clients.

In a statement posted on the Taiwan Stock Exchange, where shares of Compal are traded, the company said Friday night that it is planning to invest more than NT$500 million (US$15.41 million) to build a facility in Poland, marking the first time the company will extend its manufacturing strength to the European market.

Through its Poland-based subsidiary CGS Technology sp. z.o.o., Compal will spend about NT$77.70 million to acquire a parcel of land in Czeladź, a city in southern Poland, and spend an additional 12.29 million euros (US$13.29 million) to build the plant there, bringing the total investment to over NT$500 million, the company said.

According to Compal, the company currently runs an aftersales service center in Poland, and the investment in the European county is aimed at catering to the automotive electronics market, as the company's first deal to extend its production to Europe.

Compal said the investment is part of the company's efforts to meet regional demand in Europe. It said it expects construction of the facility will be completed by the end of the second quarter of 2025, with production slated to begin by the end of the year.

Compal added the new plant is expected to start generating sales in 2026.

Automotive electronics is among Compal's major businesses but its products also include handheld devices, wearable gadgets, laptop and desktop computers, Internet of the Things applications, servers and healthcare equipment.

Market analysts said currently, Compal's automotive electronics clients are automakers in Europe, and sales in the business are expected to grow at a double digit pace in 2024.

Local news media cited unnamed sources from Compal as saying the company did not rule out the possibility of expanding its production beyond automotive electronics in Poland by taking into account clients' needs.

The reports said Compal had focused on Vietnam in terms of overseas investments in the past, and has also wanted to be closer to its clients in Europe.

The reports added that capital expenditure to meet overseas investments is expected to range between NT$7 billion and NT$8 billion this year, little changed from last year.

According to the reports, Compal has intensified its efforts in automotive electronics development, and the company started to roll out automotive electronics items in a plant located in Mexico in 2023, which has begun to post sales for the company.

Last year, Compal posted NT$7.67 billion in net profit, up 5.2 percent from a year earlier, with earnings per share at NT$1.76.