A key part of the Taiwanese plastics industry's plan to stay ahead of the movement of manufacturing to mainland China sits in a nondescript, three-story building in the industrial city of Taichung.
There, more than 70 engineers and researchers at the Plastics Industry Development Center work on things like electrically conductive polymer screens for mobile phones, working to replace traditional light-emitting diodes, or finding ways for local companies to improve their plastics manufacturing.
PIDC, which gets about half of its US$6.2 million annual budget from government research contracts, is the industry's answer to the last few years of flat domestic sales and growth shifting to the mainland, said Zen-Wen Chiou, information manager for the center and a former researcher there.
The Taiwanese industry has traditionally been focused on manufacturing for multinational firms, particularly computer and information technology products. But as mainland China develops into the workshop of the world, the domestic Taiwanese industry has sought ways to develop its own brands and beef up technology, he said.
Struggle for survival
``Many companies in the plastics industry, originally they were more [original equipment manufacturer]-oriented, but you know the margins there are getting lower and lower as work shifts to mainland China,'' he said. ``They have to start thinking about how to create a new brand or globalize. They are trying to make their own products and ideas, so they need more advanced technology and more advanced concepts in management and international sales.''
Outside of a few notables like Formosa Plastics Group and Chi Mei Corp., the Taiwanese plastics industry has a lot of small manufacturers, Chiou said. He was interviewed at the center March 20.
``The small companies are losing competitiveness,'' Chiou said. ``That is the reason why these companies need more support from the government.''
The center opened in 1993 with about 30 staffers, one of seven government-funded institutes targeting industries ranging from mold building to shoes to pharmaceuticals, but the centers have expanded as Taiwan's government has sought a larger partnership with industry. In March, Premier Su Tseng-chang, for example, announced plans to spend T$32 billion (US$980 million) by 2010 to research technology-intensive manufacturing such as nanotechnology, radio frequency identification and newly emerging ``flexible electronics'' like electronic paper for lighted displays on packaging.
PIDC has research in several of those areas, including nanotechnology and RFID. It's also pursuing work in biodegradable polymers, plastic films and materials for implantable medical devices.
As well, the center focuses on education and training programs for local companies, a key component to making industry more competitive, said PIDC President Michael Lin.
About half of its business is contracts with companies, either to do research or as a testing center. The PIDC signed an agreement with the U.S. National Science Foundation to test water filtration products, and can validate biodegradable polymers to see if they meet ASTM standards.
Sometimes it takes a long time for the center's work to show fruition.
Chiou started as a researcher in the early days of PIDC, after a stint at Auburn University in the United States, doing research for polymer composites used on the U.S. space shuttle.
At PIDC, he started work finding ways to make a wood and plastic composite for building products, now a booming market but at the time an area few put much stock in.
He developed the technology, and the center showed it at plastics events in the mid-1990s. About 200 companies came to the PIDC to take a look, only to decide they were either unsure of how to make it work in the factory or unclear how to market it. So it sat on the shelf.
That changed a few years later as interest in wood-plastic blends grew. Today, Choiu said his research is used in making window blinds by Taiwanese firm Nien Made Enterprises Co. Ltd., which makes products for international home furnishings companies. That delay is typical in research work, he said.
``I did the job 10 years ago, and we earned the money 10 years after,'' he said. ``With new ideas or new concepts, it will take you more than five years to come up with commercial products.''
That could be the case with finding a role for plastics in nanotechnology - it could take time to make the work pay off cost effectively, he said. For example, plastics could see benefits in using nanoparticles to improve the barrier properties of packaging, he said.
Today, the PIDC is doing joint research on composites with a companion center for the Taiwanese stone and marble industries. The last few years have also seen the center work more closely with Taiwanese research centers for the printing and precision metalworking industries, Chiou said.
The center also opened a small business incubator in 2000. It's too soon to tell how most of that work has gone, but it has helped companies like a Taiwanese baby stroller manufacturer reach international markets, he said.
The center has a range of equipment at its facility that would look at home in any plastics plant, including several testing labs and pilot manufacturing operations, with five injection presses, including gas-assisted and compression technology, two extruders, blown film and shrink film lines, blow molding machines and several compounding lines. It also has a clean room for medical work.
A tour of the facility also hints at the more exotic: a long hallway of imposing metal doors secured with electronic locks, holding confidential research work, accessible only to the scientists doing the research.
All of its research is application-specific and is designed to have market applications, as opposed to more basic research. The size of the center, the range of work and the specific application-oriented focus makes it unique in Asia, Chiou said.