Through close collaboration and regular industrial upgrading, companies in central Taiwan’s Lugang Township have formed a world-leading bathroom fixtures cluster.
Longshan Temple is perhaps the most prominent symbol of Lugang Township’s prosperous past as a major shipping hub. In the late 18th century, local gentry and merchants who had grown rich from the bustling port in the coastal area of central Taiwan’s Changhua County invited leading architects and artisans to shape a resplendent place of worship. The temple, renowned for its intricate decorative details, has since been designated a national historic site.
Over time, the prevalence of such extravagant displays of wealth receded as the port lost its luster owing to shifts in Taiwan’s geopolitical status and silting of the harbor. After large-scale commercial shipping deserted Lugang, at one time the second largest city on the island, another industry with water at its core slowly came to dominate the township’s economic activity. The area, named for its once prosperous deerskin trade, has maintained an outsized role in the global economy as a leading hub of bathroom and plumbing fixture manufacturers.
The origins of this industry cluster in northeastern Lugang’s Dingfanpo area can be traced back to the final years of Japanese colonial rule (1895-1945), said Yang Yong-fang (楊永芳), head of the Plumbing Association of Taiwan, which counts about 200 firms in the township among its members. At that time, residents who had worked for locally based Japanese hardware suppliers began setting up their own factories. During the post-World War II reconstruction boom and economic expansion of subsequent decades, more and more plants emerged to help meet rising demand in international markets.
Locally made tapware products are exhibited at the Taiwan Institute for Plumbing Innovation in Lugang Township of central Taiwan’s Changhua County. (Photos by Chen Mei-ling)
According to Yang, also CEO of local brassware producer Tsangkuo Industrial Co., the cluster expanded dramatically throughout the 1970s amid the rapid industrialization of Taiwan’s economy. It reached its peak in the 1980s when Dingfanpo became one of the world’s leading sources of faucets. While overseas competition has intensified in the decades since, Lugang persists as a stronghold of the global industry. “Business has remained stable and profitable to this day, even as other manufacturing sectors in Taiwan have experienced declines,” Yang said, referring to industries such as clothing, shoes and umbrellas that have shifted production abroad to take advantage of lower labor costs.
Today, Dingfanpo is home to some 600 faucet-makers and related firms. Most of these companies function primarily as original equipment manufacturers for international brands. Statistics from the Ministry of Economic Affairs show that the production value of Taiwan’s plumbing fixtures sector stood at roughly NT$50 billion (US$1.66 billion) in 2016. Yang’s association estimates that Lugang firms accounted for up to 70 percent of this amount.
Developing in Unison
The cluster’s international competitiveness is primarily a result of close-knit collaborative relationships among local producers. Yang noted that faucet-making is a complicated process involving dozens of intricate components, so manufacturers in Dingfanpo, typically small enterprises, have developed sophisticated divisions of labor characterized by high levels of specialization. “As a rule, our companies cooperate rather than compete against one another,” he said
According to Chen Wei-chou (陳韋舟), CEO of Lugang-based sand casting factory Dayu Copper Co., most of his company’s semifinished brassware goods are sold to polishing and plating firms in Dingfanpo. This close proximity to downstream companies promotes production efficiency and flexibility while offering significant savings on transportation costs.
Another key contributor to the cluster’s competitiveness is a shared commitment to innovation and industrial upgrading. Yang’s Tsangkuo Industrial is one of the larger local firms, with some 100 employees operating facilities for casting, automated machine processing, testing, packaging and marketing. “We constantly update our machinery to stay on top of emerging manufacturing trends,” he said.
An employee at sand casting factory Dayu Copper Co. in Lugang creates semifinished brassware goods. (Photo by Chen Mei-ling)
Likewise, Chen stressed that Dayu regularly introduces the latest casting equipment and recently installed new ventilation and cooling facilities to improve product quality and working conditions.
One of Dayu’s customers is metal plating facility Managing Technology Co. The Lugang-based company’s general manager, Chang Chia-lieh (張家烈), highlighted the role that government agencies play in modernizing industry production methods. In the 1990s, technical assistance from the Institute of Nuclear Energy Research under the Cabinet-level Atomic Energy Council enabled Managing Technology to explore advanced physical vapor deposition (PVD) techniques that use titanium as the plating material. As a result of these efforts, the company was able to launch PVD operations in the early 2000s and has continued to upgrade related technology every one or two years since, Chang said.
Managing Technology has also received expert guidance from the government-supported Industrial Technology Research Institute’s (ITRI) branch office in central Taiwan’s Taichung City. The office facilitated technology transfers from the local aerospace sector that have improved the durability and erosion resistance of the firm’s PVD titanium coatings.
Regular industrial upgrading has allowed Managing Technology to offer plating services for a wider variety of products. Tapware goods, once the company’s predominant focus, now comprise about 30-40 percent of its output. Added to the mix are items such as bicycles, furniture, frames for glasses and watches as well as various types of consumer electronics products including smartphones. Most of these are high-end goods destined for export.
Next on Managing Technology’s upgrade agenda is the introduction of advanced automation systems. ITRI is also providing technical consultations for this project, which seeks to add robotic arms to the company’s production lines. “The price of competitiveness is the constant pursuit of industrial innovation and more efficient manufacturing systems,” Chang said.
Lugang-headquartered Managing Technology Co. offers advanced plating services for tapware and a variety of other products. (Photo by Huang Chung-hsin)
Modernization and Branding
Plumbing association head Yang said that the cluster’s commitment to modernizing production processes enables the regular introduction of new and more technologically complex products. He cited the popularity of locally developed noncontact faucets, a key driver of growth for many firms in recent years. Lugang-based companies have produced increasingly refined versions of this form of tapware to meet growing international demand in the wake of public health emergencies like severe acute respiratory syndrome, or SARS, and swine flu.
The confidence that comes from rising technological prowess is encouraging a new generation of factory owners and operators in Dingfanpo to sell products under their own brand names. Prominent examples include the Falali and Justime lines developed by Falali Bath Boutique Co. and Sheng Tai Brassware Co., respectively. More than a dozen local companies have also joined forces to market their products collectively under the brand T.A.P., or Taiwan Aqua Professionals.
Chen Hung-yi (陳弘毅), chief of the Intelligent Technology Section at the Taichung branch office of the government-supported Metal Industries Research and Development Centre (MIRDC), said that branding marks the logical next step in the cluster’s evolution given its mastery of every facet of the manufacturing and product development process. To foster this move toward branding and advanced R&D, the center helped established the Taiwan Institute for Plumbing Innovation last year. Located in downtown Lugang, the venue brings together tapware companies and industry experts through hosting exhibitions, forums and training classes.
Chen also leads MIRDC’s Taiwan Plumbing Research and Testing Laboratories. The facility was set up in 1999 to strengthen local firms’ development processes and efforts to get international product certifications. The same year, it became the first testing center in Asia accredited by the U.S.-headquartered International Association of Plumbing and Mechanical Officials. The lab offers advanced inspection services spanning such areas as noise, pressure and toxicity, providing data to aid local companies in acquiring quality and safety certificates for major markets like the EU, Japan and the U.S.
According to Chen, the standard of a nation’s bathroom fixtures and plumbing is an indicator of its social development, and as such the quality of Lugang-made goods underscores Taiwan’s status as a major developed economy. “These products are not only crucial for personal comfort and hygiene, but in a country where people live in close proximity like Taiwan, they must be designed so as to minimize the impact of one household’s water use on another,” he said. “In this regard, Lugang firms, with their advanced product development skills, are helping improve quality of life.”
Write to Pat Gao at cjkao@mofa.gov.tw