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Taiwan Smart Machinery | July 17, 2018

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Orders stacking up for machine tool industry

Orders stacking up for machine tool industry
Taiwan Smart Machinery

Orders stacking up for machine tool industry

(Apple Daily) With growing demands for aerospace and automotive markets because of the global economic recovery, the performance of the machine tool industry continues to impress this year. After the major manufacturers in the industry revealed strong revenue expansion this year, the current orders keep stacking up. Tongtai in particular received NT$ 20 billion worth of orders visibility up to October.

Because of the increased orders from all over the world, many Taiwan machine tool industry manufacturers saw their revenue grew significantly in the first half of 2014. AWEA, Goodway, Hiwin, and Tongtai all had over 20 percent annual revenue growths. Among them, Tongtai’s NT$ 4.34 billion revenue in the first half grew by 22.27 percent compared to the first half of 2013. Its chairman Yan analyzed that no matter which regions the orders are coming from the position is being stabilized. Based on the orders received this year, Tongtai’s operations are expected to keep rising.

Tongtai’s orders in hand currently values approximately NT$ 20-25 billion, runs until October, which is the number one rank among the entire industry. According to the status of first half exports, Yan said the automobile industry had the most significant growth from last year. Regional wise although growths were visible in all, China and Taiwan’s orders had the most contribution, accounting for nearly 65 percent. As the plants revenues grow considerably this year, Yan thought the Japanese Yen depreciation caused Japanese manufacturers’ price margin decrease impact has gradually lessened. After a year of adjustment, currently the Taiwanese manufacturers have consistency in product positioning and able to maintain a certain price margin with the Japanese manufacturers and the orders have gradually stabilized.

In addition to Tongtai’s revenue growth, many other major machine tool manufacturers had strong revenue performances. AWEA for example, also benefited from the recovery of the automobile industry. Driven by the increased demand for production, new orders in the second quarter each month are close to NT$ 300 million, current orders in hand is about NT$ 14 billion and goes through October as well. Goodway, AWEA’s parent company currently has nearly NT$ 800 million worth of orders in hand. Due to the stimulation to the automotive and aerospace industries, new orders each month maintained around NT$ 200 million per month. Currently the order in hand are close to NT$ 800 million in value. Overall, the Taiwan domestic machine tool industry in general should carry the momentum for new orders entering the second half.

Although Kao Fong recorded NT$ 131 million revenue in June, it showed a decline of 29.14 percent compared to the same period a year ago. Kao Fong’s executive’s analysis pointed to the delays in vessel schedules and the letters of credit from customers affected the lead time, thus causing the negative growth for the month of June. The forecast for July have the compnay recover to positive growth. Kao Fong currently has more than NT$ 300 million of orders in hand, as its executive pointed out. The company feels optimistic about the annual revenue and forecast a growth of over 10 percent compared to 2013.

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