Taiwan’s machine tool output likely to grow in 2015 due to demand from US
The production value of Taiwan’s machine tool sector is expected to grow slightly in 2015 because of growing demand from the United States, the world’s largest economy, according to the Industrial Economics and Knowledge Center (IEK).
In a report, the IEK said Taiwanese machine tool makers could also get a boost this year from rising demand in some European countries, such as Spain and Switzerland, and from higher car sales driven by lower fuel prices.
The output value of Taiwan’s machine tool business will grow 1.3 percent to 2.5 percent in 2015 to about NT$152.9 billion (US$4.92 billion), according to the IEK, a research unit under the governmentsponsored Industrial Technology Research Institute ( ).
The projected growth would lag behind the 6.8 growth seen in 2014 when manufacturing activity in the major economies of the world staged a strong rebound, the IEK said.
The U.S., mainland China, Europe and Japan are the biggest markets for Taiwan’s machine tool firms, the IEK said, with exports accounting for about 80 percent of Taiwan’s machine tool sales over the past five years.
But several factors could hurt Taiwan’s exports of machine tools this year.
With the mainland restructuring its economy, absorbing excess capacity and strengthening its own domestic supply chains, demand for machine tools from the mainland Chinese market is expected to stay unchanged this year, the IEK said.
Demand from Europe could be affected by the continent’s high unemployment rates, tightening fiscal policies and deflationary pressures, and demand from Russia, Thailand and Indonesia could also stagnate because of either geopolitical tensions or an exodus of foreign funds, the IEK said.
Domestic machine tool sales could rise about 8 percent this year from a year earlier, however, helping offset the unfavorable external factors to some extent, the IEK said. Quaser Machine Tools Inc. (
) President Liao Tzu-en said he hoped Taiwan’s government will help the local machine tool sector by keeping the value of the Taiwan dollar down and keep the country competitive at a time when weakness in the Japanese yen and the euro is hurting Taiwanese exporters.