Machine tool exports might decline less than expected this year on the back of potential US orders, the Taiwan Machine Tool & Accessory Builders’ Association (TMBA, 台灣工具機暨零組件公會) said on Friday.
Outbound shipments for the whole of this year might decline by just a single-digit percentage from last year, association secretary-general Carl Huang (黃建中) said by telephone.
“A single digit decline is not that bad, as the latest statistics indicate contraction across all of Taiwan’s main markets this year,” Huang said.
With the US market expected to start recovering after the Nov. 8 US presidential election, exports from Taiwan’s machine tool industry are likely to gain support in the final quarter of this year, he said.
In the first eight months of this year, local machine tool makers shipped US$1.87 billion worth of goods overseas, down 14.9 percent from the same period last year, data compiled by the Taichung-based association showed.
China is still the largest — and most important — market for Taiwanese machine tool makers on the back of demand for industrial automation and upgrades as well as a new cycle of capital expenditures.
However, exports to China plunged 14 percent to US$577.2 million in the January-to-August period from a year earlier, the association’s data showed.
Chinese customers’ demand for high-end products for industrial automation poses a challenge for Taiwanese makers, Huang said.
That is why only Germany’s machine tool exports to China have sustained growth this year, he said, citing Germany’s advantage in sophisticated and advanced products.
Machine tool shipments to the US, Taiwan’s second-largest market, declined by 11.1 percent annually to US$224 million in the first eight months of the year, while exports to Turkey, the third-largest market, dropped 12.6 percent to US$112.7 million, TMBA data showed.
Exports of metal cutting machines declined 15 percent year-on-year to US$1.55 billion in the first eight months of the year, while metal-forming machines fell 14.3 percent to US$316 million.
Credit Suisse Group AG said in a report in April that automation proliferation and foreign exchange rates would play a crucial role in the development of Taiwan’s machine tool industry.
However, the next wave of growth is likely to also come from the assembly of miniature parts, an improvement in production efficiency and an effort to ensure a safer working environment, it said.