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The rubber seal industry has developed in Taiwan for more than half century. So far, it is still mainly based on the OEM model to provide the rubber seal components required by European, American and Japanese automobile and industrial system manufacturers. The numerous rubber sealing product manufacturers in Taiwan are still at the stage of imitation in terms of product technology and material development, and there is still existed a large gap between the designing and manufacturing capabilities in advanced countries such as Europe, America and Japan. In addition, since the 1990s, Taiwan's rubber seal industry has also faced problems such as rising wages, rising environmental awareness, difficulty in acquiring land, and difficulty in operating due to high manufacturing costs. What's more, in recent years, the manufacturing capacity of some developing countries has been increasing day by day, and they have used low-price strategies to grab the rubber sealing market, which makes Taiwan's rubber seal manufacturers face a great threat. Therefore, in order to survive, companies in the rubber sealing industry chain must actively think about how to innovate at different levels to improve their overall competitiveness in technology, quality, and even the transfer of production bases. However, under the condition of limited resources, not all types of innovation can be carried out by enterprises; in addition to the improvement of product research and development capabilities, enterprises must also measure their own position in the supply chain and the relationship between their partners. These factors will affect whether the enterprise can successfully obtain different types of innovation and the external resources it needs.
In the recent years, because of the increasing labor costs in China, and the US-China trade war is not conducive to the export of manufacturing products, many Taiwanese rubber seal manufacturers are considering moving their production bases from China to Taiwan or Southeast Asian countries. Thailand, located on the Indo-China Peninsula, has a superior geographical location and relatively abundant labor factors, which are the key conditions for attracting Taiwan's manufacturing industry to actively invest and set up factories. Through the discussion of the external objective environment and internal subjective conditions of the industry, combined with Michael Porter's (1979) Five Forces analysis, SWOT analysis and Business model canvas to be a referenced evaluation framework. It is aimed, at the current situation of the rubber sealing industry, to think how to achieve value creation through business model innovation. However, when an enterprise chooses an innovation model, in addition to examining its own resources and competitiveness, it must also consider changes in the external environment, and obtain resources that it lacks in order to enable the enterprise to cope with changes in the general environment, and then effectively promote innovation and achieve the purpose of value creation. On considering of the international reality, this paper analyzes and compares the investment environment of the six countries in the Indo-China Peninsula, and uses the PEST analysis model to explore why Thailand is the new target for ProGum's future investment and factory location selection.
Keywords: rubber sealing industry, overseas investment, new southbound policy, economy of Indo-China Peninsula, Thailand investment
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