Apple supplier Simplo hopes to ride electric bicycles to growth
View(s):HSINCHU, Taiwan (Nikkei) — Taiwan’s battery pack maker Simplo Technology is eyeing growth in emerging areas from electric bicycles and data centres to industrial equipment, moving beyond its existing businesses of supplying battery modules to Apple and other notebook makers.
“We are aiming to boost our business in non-information technology segments beyond notebook, tablet, and smartphones, as those markets are quite flat and not growing,” Chairman and Chief Executive Raymond Sung told the Nikkei Asian Review in an interview recently.
The market for electric bicycles is booming and could still expand 10 per cent on average every year, according to CEO Raymond Sung ( Reuters pic)
Mr. Sung’s comments came as overall demand for consumer electronics such as notebooks, tablets and smartphones slowed, and as Chinese competitors are gearing up with government subsidies and slashing prices for smartphone battery modules.
According to analysts, Simplo is a leading battery module maker with orders for Apple’s MacBook and iPhone range. It also supplies to the global personal computer makers HP, Lenovo Group, Dell, and Asustek Computer.
Key iPhone assembler Hon Hai Precision Industry, better known as Foxconn, is Simplo’s biggest shareholder with a 8.6 per cent stake in the battery module maker via its fully-owned subsidiaries, according to Simplo’s latest annual report.
Mr. Sung said that his company had stopped supplying to some mobile clients where the business had razor-thin margins and turned its focus on four key areas including battery packs for electric bikes, data centres, automation equipment and home energy storage systems to offset the headwinds in its current core business.
Profit margins from the new products could be twice as high as those offered by consumer electronics, and emerging areas could provide better growth momentum, he said.