Q1 Value Rise of 5.2% For Taiwan Transport Equipment Industry
May 31, 2005 Ι Industry In-Focus
Ι Auto Parts and Accessories Ι By Quincy, CENS
Total output for transportation vehicles and parts made in Taiwan, including the automobile, powered two-wheeler (PTW), and bicycle segments, reached NT$121.6 billion (US$3.87 billion at US$1:NT$31.4) in the first quarter, up 5.2% from the same period of last year
By individual segment, the first-quarter production values for the automobile, PTW, and bicycle lines were NT$87.7 billion (US$2.79 billion, up 3.2% from the same period of last year), NT$19.1 billion (US$608 million, up 2.6%), and NT$14.76 billion (US$470 million, up 23.6%), respectively.
The data was compiled by the Industrial Development Bureau (IDB) of the Ministry of Economic Affairs (MOEA) and the IT IS (Industrial Technology Information Service & Promotion Project) of the Industrial Economics & Knowledge Center (IEK).
Status Quo
The automobile industry in Taiwan registered first-quarter production value of NT$87.7 billion (US$2.79 billion) and enjoyed a year-on-year (Y/Y) growth rate of 3.2%. The value of complete autos accounted for NT$49.7 billion (US$1.58 billion), up 3.0%, and that of auto-parts about NT$37.9 billion (US$1.21 billion), up 3.4%, according to the IDB and IT IS.
Over 139,000 automobiles were sold in the first quarter, up 14.8% from the same period of last year, putting the industry on track to move 480,000 units by year-end. The first-quarter figures were helped by the introduction of new car models late last year, but demand is expected to fall in the second half.
Taiwan's auto-part exports are dominated by aftermarket (AM) sales, with major items including auto lamps, rubber tires, and plastic parts. Some local AM-parts suppliers, including Tong Yang Industrial Co. (the world's largest plastic body-parts supplier) and TYC Brothers Industrial Co. (No. 1 AM auto-lamp exporter in Taiwan), are setting up new plants in Europe, one of their major markets, to accelerate product delivery there. Both firms' new Europe facilities are scheduled to start mass production in the second half this year.
PTW sales in Taiwan grew slightly in the first quarter, but most local producers expect the full-year figure to hold steady at about 700,000 units. The top-selling models are 125cc scooters, accounting for 40% of the total, 100cc scooters, and 50cc four-stroke engine scooters.
Taiwan's PTW exports have been affected by the appreciation of the NT dollar and fierce competition from low-cost price-undercutting rivals at the market's lower end, including the 50cc and 90cc scooter segment. Export volume is expected to decrease, but profit margins should continue to rise as most local PTW exporters are turning out more powerful higher-end products.
Taiwan's PTW-parts exports are expected to slide this year due to fierce international competition and higher production costs due to rises in material prices. In addition, all of the top-three PTW brands in Taiwan have decided to outsource more parts from overseas suppliers to cut costs. Taiwan PTW-parts makers, however, for whom export sales account for about 60% of total production, still enjoyed two-digit sales growth in the first quarter due to their products' strong competitiveness in developing nations.
The production value of Taiwan's PTW-parts sector was NT$10.34 billion (US$329 million) in the first quarter, up 11.3% from the same period of last year.
Taiwan's bicycle and parts line grew by 23.6% in the first quarter, with bicycle output up 24.2% to NT$8.97 billion (US$286 million) and parts production gaining 22.6% to NT$5.79 billion (US$184 billion). Increased exports of bike lights, wheel rims, and spoke products helped drive the strong gains.
In the past few years, Taiwan's bicycle makers have steadily upgraded products quality as well as added value and functions to their products with the help of the A-Team.
The A-Team is an alliance for the development, production, and marketing of high-end bicycles. The alliance was formed by the Taiwan Bicycle Exporters' Association (TBEA), two leading bicycle makers (Giant Manufacturing Co. and Merida Industry Co.), and a number of internationally known bicycle part makers. Other companies have since joined the alliance.
The A-Team aims to improve both the quantity and quality of bicycles that are made in Taiwan. Giant and Merida now jointly buy parts from suppliers that are also alliance members, which means more business for the suppliers but also more work on product development. The ultimate goal is to give Giant and Merida an image similar to that of BMW and Mercedes-Benz.
The delayed shipments of derailleurs by Shimano of Japan, the world's largest bike-parts maker, has driven some buyers to turn to SRAM of the U.S., SR Suntour of Taiwan, and Campagnolo of Italy.
Prospects
Among variables that may impact the domestic new-car market this year, the IDB and IT IS predict, are high gasoline prices and fluctuating currency-exchange rates.
Taiwan's PTW line is expected to continue growing in the coming few years but at a slower pace than before. This year, the U.S. and Asian economies have been showing signs of recovery, and this is expected to stimulate demand for PTWs. Rising oil prices are also expected to attract more people to fuel-efficient PTWs. The IDB and IT IS predict that the production value of local PTW and parts line will outstrip NT$90 billion (US$2.87 billion) this year.
The IDB suggests that local PTW and parts makers expand overseas sales and increase production ratio of higher added-value products to minimize the impact of shrinking local demands. The establishment of overseas production bases will be helpful for expanding overseas expansion, the bureau points out, and the development of ATVs, electric scooters, and other related products can help producers enter new markets.
With the increasingly strong R&D capability achieved by members of the A-Team, Taiwan's bicycle industry is rapidly transforming into a global original design manufacturing (ODM) and original brand manufacturing (OBM) base. Local bike and parts makers are also expected to win big-ticket orders if the European Union decides to slap Vietnam with anti-dumping tariffs on such products.
Table:
Source: IDB, IT IS
By individual segment, the first-quarter production values for the automobile, PTW, and bicycle lines were NT$87.7 billion (US$2.79 billion, up 3.2% from the same period of last year), NT$19.1 billion (US$608 million, up 2.6%), and NT$14.76 billion (US$470 million, up 23.6%), respectively.
The data was compiled by the Industrial Development Bureau (IDB) of the Ministry of Economic Affairs (MOEA) and the IT IS (Industrial Technology Information Service & Promotion Project) of the Industrial Economics & Knowledge Center (IEK).
Status Quo
The automobile industry in Taiwan registered first-quarter production value of NT$87.7 billion (US$2.79 billion) and enjoyed a year-on-year (Y/Y) growth rate of 3.2%. The value of complete autos accounted for NT$49.7 billion (US$1.58 billion), up 3.0%, and that of auto-parts about NT$37.9 billion (US$1.21 billion), up 3.4%, according to the IDB and IT IS.
Over 139,000 automobiles were sold in the first quarter, up 14.8% from the same period of last year, putting the industry on track to move 480,000 units by year-end. The first-quarter figures were helped by the introduction of new car models late last year, but demand is expected to fall in the second half.
Taiwan's auto-part exports are dominated by aftermarket (AM) sales, with major items including auto lamps, rubber tires, and plastic parts. Some local AM-parts suppliers, including Tong Yang Industrial Co. (the world's largest plastic body-parts supplier) and TYC Brothers Industrial Co. (No. 1 AM auto-lamp exporter in Taiwan), are setting up new plants in Europe, one of their major markets, to accelerate product delivery there. Both firms' new Europe facilities are scheduled to start mass production in the second half this year.
PTW sales in Taiwan grew slightly in the first quarter, but most local producers expect the full-year figure to hold steady at about 700,000 units. The top-selling models are 125cc scooters, accounting for 40% of the total, 100cc scooters, and 50cc four-stroke engine scooters.
Taiwan's PTW exports have been affected by the appreciation of the NT dollar and fierce competition from low-cost price-undercutting rivals at the market's lower end, including the 50cc and 90cc scooter segment. Export volume is expected to decrease, but profit margins should continue to rise as most local PTW exporters are turning out more powerful higher-end products.
Taiwan's PTW-parts exports are expected to slide this year due to fierce international competition and higher production costs due to rises in material prices. In addition, all of the top-three PTW brands in Taiwan have decided to outsource more parts from overseas suppliers to cut costs. Taiwan PTW-parts makers, however, for whom export sales account for about 60% of total production, still enjoyed two-digit sales growth in the first quarter due to their products' strong competitiveness in developing nations.
The production value of Taiwan's PTW-parts sector was NT$10.34 billion (US$329 million) in the first quarter, up 11.3% from the same period of last year.
Taiwan's bicycle and parts line grew by 23.6% in the first quarter, with bicycle output up 24.2% to NT$8.97 billion (US$286 million) and parts production gaining 22.6% to NT$5.79 billion (US$184 billion). Increased exports of bike lights, wheel rims, and spoke products helped drive the strong gains.
In the past few years, Taiwan's bicycle makers have steadily upgraded products quality as well as added value and functions to their products with the help of the A-Team.
The A-Team is an alliance for the development, production, and marketing of high-end bicycles. The alliance was formed by the Taiwan Bicycle Exporters' Association (TBEA), two leading bicycle makers (Giant Manufacturing Co. and Merida Industry Co.), and a number of internationally known bicycle part makers. Other companies have since joined the alliance.
The A-Team aims to improve both the quantity and quality of bicycles that are made in Taiwan. Giant and Merida now jointly buy parts from suppliers that are also alliance members, which means more business for the suppliers but also more work on product development. The ultimate goal is to give Giant and Merida an image similar to that of BMW and Mercedes-Benz.
The delayed shipments of derailleurs by Shimano of Japan, the world's largest bike-parts maker, has driven some buyers to turn to SRAM of the U.S., SR Suntour of Taiwan, and Campagnolo of Italy.
Prospects
Among variables that may impact the domestic new-car market this year, the IDB and IT IS predict, are high gasoline prices and fluctuating currency-exchange rates.
Taiwan's PTW line is expected to continue growing in the coming few years but at a slower pace than before. This year, the U.S. and Asian economies have been showing signs of recovery, and this is expected to stimulate demand for PTWs. Rising oil prices are also expected to attract more people to fuel-efficient PTWs. The IDB and IT IS predict that the production value of local PTW and parts line will outstrip NT$90 billion (US$2.87 billion) this year.
The IDB suggests that local PTW and parts makers expand overseas sales and increase production ratio of higher added-value products to minimize the impact of shrinking local demands. The establishment of overseas production bases will be helpful for expanding overseas expansion, the bureau points out, and the development of ATVs, electric scooters, and other related products can help producers enter new markets.
With the increasingly strong R&D capability achieved by members of the A-Team, Taiwan's bicycle industry is rapidly transforming into a global original design manufacturing (ODM) and original brand manufacturing (OBM) base. Local bike and parts makers are also expected to win big-ticket orders if the European Union decides to slap Vietnam with anti-dumping tariffs on such products.
Table:
Output in Taiwan Unit: NT$1 million | ||||||||
Year
Industry |
||||||||
| Complete | ||||||||
| Parts | ||||||||
| Subtotal | ||||||||
| Complete | ||||||||
| Parts | ||||||||
| Subtotal | ||||||||
| Complete | ||||||||
| Parts | ||||||||
| Subtotal | ||||||||
- Get to Know Us
- About Us
- Business Partners
- Follow Us on Facebook
- Services & Products
- Customized Sourcing Services
- Trade Magazines / eBooks
- Taiwan Industry Updates
- Global Trade Shows
- Global Pass
- Help
- FAQ
- Contact Us
- Site Map
©1995-2006 Copyright China Economic News Service All Rights Reserved.
