KEY POINTS:
Technology company Rakon expects to double its total production capacity once its Chinese joint venture agreement with Timemaker Crystal Technology begins manufacturing late next year.
The company yesterday announced that it had signed a joint venture agreement with Timemaker, a major manufacturer of high specification quartz crystal blanks used in its products.
The agreement sees Rakon take up a 70 per cent share in the as-yet-unnamed joint venture company, as well as a 40 per cent share in Timemaker.
Managing director Brent Robinson said the partnership with the Chinese company was the best means of achieving its plans to expand production in China.
Timemaker have been supplying Rakon with quartz crystal blanks for its crystal resonators for a number of years.
"With Timemaker, we have a partner on the ground in China who knows the industry and technology, which is a huge benefit. Our investment in Timemaker also allows us to take greater control of our overall supply chain." Construction of the factory in Shenzhen is expected to begin at the end of this year, with production to begin late 2009.
The factory will mainly manufacture quartz crystal resonators and temperature compensated crystal oscillators for high-end and high-volume consumer applications, including the rapidly emerging GPS cellular phone market.
"China is the centre for manufacturing consumer electronics and we expect significant growth there in the coming years as mobile phones, GPS and other applications become even more prolific. Robinson said the company plans to invest between $45 and $70 million in China over the next five years, depending on the speed of market growth.
He stressed that the company remains committed to its New Zealand manufacturing base.
Rakon employs 500 people in Auckland and a total of 900 globally. Shares closed yesterday at $2.70, up 10c.
