PALO ALTO, CALIF. — A joint venture of Palo Alto Products International Pte. Ltd. and Delta Electronics Ltd. is constructing a campus in Thailand with capacity to make 500,000 personal-computer enclosures per month.
``We can do bare bones systems for probably the lowest cost in the world ... particularly with our arrangement with Delta,'' Palo Alto Product's Malcolm Smith said in an interview at the firm's principal office in its namesake California city.
Initial stamping and assembly operations should start in March in a 375,000-square-foot facility, and injection molding will begin in September in a 255,000-square-foot building, said Smith, vice president of design and engineering.
Palo Alto will mold plastic enclosures and stamp out sheet metal components, and Delta will build power supplies, disc drives and perhaps motherboards. The venture, yet to be named, will supply the enclosures to original-equipment-manufacturer plants anywhere in the world. Elson Chang has been named general manager of the integration unit, located in Bangpoo Industrial Estate in Bangkok.
The plant will operate 30-40 Toshiba and Taiwanese-made injection molding machines with clamping forces of 450-850 tons, Smith said. Also, the site will use 52 metal stamping machines.
Palo Alto will make tools at its existing facility in Taipei, Taiwan, where it also has molding operations.
``We'll be able to offer a PC chassis with a Delta power supply installed for a very competitive price and in a controlled high-quality manufacturing environment,'' Smith said. Thailand ``has a trained labor force'' and is ``not a mainland-China facility with mainland-China-type-quality problems.''
``Being able to do business in Thailand is easier than in China now,'' Smith said.
Privately held Palo Alto Products employs 350 and had sales of $93 million for fiscal 1998, which ended in March. The fast-growing firm is beginning operations in a new facility that it constructed last year in New Braunfels, Texas, largely, Smith said, to serve ``our biggest customers.''
Palo Alto envisions building a worldwide organization. ``We are taking it one step at a time and trying to put the pieces in place where we can best suit our customer needs and our growth,'' Smith said.
Taipei-based Delta employs 21,000, had fiscal 1998 sales of US$1.6 billion and trades on the Taiwan stock exchange. Delta sought out Palo Alto as a partner in the Thailand project ``due to the company's strong capabilities in engineering, tooling and manufacturing,'' Chang said in a Palo Alto Products news release.
