Nidec Chaun-Choung Technology (CCI) will step up its capacity expansion pace in Vietnam, where the Taiwan-based cooling module maker operates a plant to fulfill mainly orders for notebooks, servers, and networking devices, in the second half of 2022, according to company chairman Junichi Nagai.
Some market observers pointed out that Nidec CCI has also entered the supply chain of Sony and will supply cooling modules for its latest game consoles. However, Nidec CCI declined to comment on its orders or clients.
In 2019, Nidec CCI decided to invest US$172 million over the next seven years to establish a production site in Vietnam, an amount far higher than those for plants in China's Kunshan and Chongqing.
Nidec CCI originally expected the capacity at the Vietnam plant to contribute 30% of the company's overall revenues in 2022, but the company is unlikely to achieve the goal because the COVID-19 pandemic has pushed back the schedules for clients to perform certifications and pilot production. However, the company is accelerating its pace to catch up with the schedules.
The company expects the Vietnam plant to contribute only less than 5% of its 2022 revenues.
Nidec CCI's Vietnam plant was originally established aiming to supply vapor chambers for smartphones. However, the company is now planning to shift the capacity to produce cooling modules for other IT products as demand for vapor chambers from smartphone vendors is weaker than expected, while the price competition from China-based cooling module makers has grown fiercer.
